What is Making Tax Digital (MTD)?

By Ben Davies · Updated 26 September 2026

Making Tax Digital (MTD) is HMRC's programme to move the UK tax system from paper and manual processes to digital record-keeping and online filing. The goal is to make it easier for businesses to get their tax right first time.

Which taxes does MTD cover?

MTD is being rolled out in stages across different taxes:

• VAT — MTD for VAT has been mandated since April 2022. All VAT-registered businesses must keep digital records and submit returns using compatible software.
• Income Tax Self Assessment (ITSA) — MTD for ITSA is being phased in from April 2026 for self-employed individuals and landlords above certain income thresholds.
• Corporation Tax — HMRC has signalled that MTD for Corporation Tax is coming, but no mandation date has been set. There is no formal requirement yet for companies to use software specifically under MTD rules for CT600 filing.

What this means for dormant companies

Although MTD for Corporation Tax has not been formally mandated, dormant company directors have already felt the practical effect. HMRC's free filing service — "File your accounts and Company Tax Return", known as CATO (Company Accounts and Tax Online) — closed on 31 March 2026. It filed a company's accounts and its CT600 return together.

In practice, directors now need commercial software to file their nil CT600 — even though the company has no trading activity. Paper is allowed only with a reasonable excuse or for a return in Welsh. This is the case regardless of whether MTD for Corporation Tax is officially in force.

What we do

We file a dormant company's accounts to Companies House and its nil CT600 to HMRC from a single dashboard. We also remind you before each deadline, including the confirmation statement you file yourself, and show which directors still need to verify their identity.

• Step-by-step guide: How to file a nil CT600 return
• Background: CATO has closed — what are your options?
• See what it costs: Pricing