HMRC Scraps Making Tax Digital for Corporation Tax
In a significant shift in its digital strategy, HMRC has officially scrapped plans to implement Making Tax Digital (MTD) for Corporation Tax. The announcement was quietly included in HMRC’s latest Transformation Roadmap, published in July 2025.
Originally envisioned as part of a broader push to modernise the UK tax system, MTD for Corporation Tax would have required companies to maintain digital records, submit quarterly updates, and file annual returns using MTD-compatible software. However, the initiative had seen little progress since its initial consultation in 2020, and its timeline had remained vague.
HMRC now acknowledges that the diverse nature of the corporation tax population—from small businesses and charities to multinationals—makes a one-size-fits-all digital approach impractical. Instead, the department is exploring alternative methods to modernise corporation tax administration that better reflect the varied needs of UK companies.
Tax professionals have largely welcomed the decision. Emma Rawson of the Association of Taxation Technicians noted that the complexity of corporation tax and the already widespread use of digital tools among businesses made the benefits of MTD for CT unclear
While MTD for Income Tax remains on track for phased implementation starting in April 2026, this latest move is seen as a win for companies who are already overloaded with administration from the wave of new tax measures implemented by the Government.
