HMRC CATO was created to help small businesses file their CT600 and company accounts for free. However, changes in UK tax law under the Economic Crime and Corporate Transparency Act (ECCTA), along with ongoing cuts to public sector funding have made the service unsustainable, and it is due to be shut down on 31st March 2026. The news about the closure adds to the challenges businesses are already facing, especially after the rising national insurance and staffing costs announced in the Autumn Budget.
What Should Businesses Do Next?
The Government's current advice suggests that businesses should download the last three years of company accounts before the closure of HMRC CATO. This is essential as after March next year, these accounts will no longer be available on the system. Businesses are encouraged to take action now to ensure they have all the necessary records saved and to avoid any disruption in the future.
With the imminent change, the UK Government recommends businesses choose a new software provider that can handle CT600 filing and annual company accounts. This will ensure they can continue to file to both Companies House and HMRC, as with the current CATO service.
The Move to Make Tax Digital
This change supports the HMRC Making Tax Digital (MTD) initiative, designed to simplify tax with digital tools to maintain compliance with government legislation and improve efficiency.
The CATO closure is also a response to changes to UK tax law under the Economic Crime and Corporate Transparency Act (ECCTA), set to transform the role of Companies House and increase security for UK companies. This reform aims to strengthen the business environment, improve national security, and combat economic crime, all while providing a more reliable companies register to support business activities.
Which Software Can I Use and What's The Cost?
If your business has fairly straightforward micro business accounting needs, there are many software providers offering basic CT600 filing with iXBRL computations and company accounts starting at around £80 + VAT. However, keep in mind that these options typically don’t include filings to Companies House, which can complicate things for those that are used to the convenience of joint filing with CATO.
While micro businesses may be able to make a marginal cost saving by filing independently to Companies House, they’ll still need to prepare their annual accounts using third party commercial software. We have already started to see the effects on our platform with growing demand for a seamless, all-in-one solution that replaces CATO, without the hassle of filing separately to Companies House and HMRC.
The Reality of Tax Filing Software
Most software providers typically offer either HMRC or Companies House filing services, but not both; meaning that businesses need to download and pay for two programs from different vendors to accomplish what would have been available in one platform using CATO.
Purchasing and downloading separate software when you are ready to submit is not only more time consuming, it could lead to inefficiencies, potentially creating confusion and causing filing errors. Another point to note is that after 31/03/2026, companies will not be able to upload files to Companies House, but will only be able to use cloud-based software for CH filings to meet the new system requirements.
Try Our Noise Free Solution for All-in-One Filing
We understand small businesses, and unlike other available providers, we offer simultaneous filing to both Companies House and HMRC online, complete with IXBRL computations to accompany the CT600 tax calculation along with fully tagged ixbrl accounts for both micro and small companies. Our software is cloud based meaning you can log on anywhere with nothing to download. Our simple to use software allows you to saves in-progress templates until you are ready to file. We also have an expert team of in-person support specialists based at our London office, available on live chat Mon-Fri.
Register with us to trial the software for as long as you like for free. You only pay when you’re ready to submit your filings.
