Manchester-based FFT Accountants has responded to HMRC’s updated Transformation Roadmap, published this week, which confirms that Making Tax Digital (MTD) for Corporation Tax will no longer be going ahead.

The firm says the move is not surprising, especially given the well-documented delays and difficulties ahead of the rollout of MTD for Income Tax (IT).

Sam Bacall, Director at FFT Accountants, said: “It’s never a surprise when the government U-turns on these sorts of things, but given the difficulty with MTD for IT, this wasn’t unpredictable.”

Sam described the decision as a welcome reprieve for businesses already dealing with an increasingly complex and costly compliance environment.

“It’s a relief for many of our clients, who are already under pressure from overcomplicated rules and rising costs. This takes away the immediate concern of another digital mandate being added to the list.”

He noted that most businesses are already using digital systems where appropriate, particularly those caught by MTD for VAT.

“Beyond the smallest and most basic businesses, most companies are already using software for their records.

“It’s not as though the sector isn’t already moving heavily towards digital. This decision just gives them the space to continue the transition on their own terms.”

When asked whether abandoning plans for MTD for Corporation Tax might hold back progress or widen the digital gap between large and small businesses, Sam said the divide is already there, but not necessarily a problem.

“There is definitely a digital divide, but the objectives of a small business compared to a large, listed company are very different.

“We don’t see the choice to scrap MTD for Corporation Tax as an automatic disadvantage to smaller firms. If anything, they now have the flexibility to adopt systems that suit their needs, rather than being pushed into something that may not fit.”

FFT is now calling for HMRC to prioritise more practical improvements to the Corporation Tax system.

“We’d like to see faster services, quicker response times and more technically able frontline staff. Businesses want to be able to get clarity up front as much as possible, rather than having to suffer subsequent HMRC investigations when they have used an incorrect tax treatment on a matter that they would have liked to be able to consult with HMRC on.”

Sam also urged HMRC to engage directly with smaller business groups before making any future decisions on digital compliance.

“There needs to be better consultation. Speaking to SME business groups would be a good place to start.”

FFT Accountants advises companies across Greater Manchester and beyond, helping them manage compliance and adopt digital systems that support their long-term goals.

For more information or to speak to an adviser, visit www.fft.co.uk or call 0161 834 2574.