HMRC consultation: Standardising company tax returns

HMRC has launched a consultation on plans to modernise and standardise the way company tax returns are prepared and filed. While the changes will not take effect immediately, they represent a significant shift in how corporation tax computations will need to be submitted in the coming years, and businesses should plan for this appropriately.

It should be noted that this consultation represents the next step in HMRC’s push to prescribe a standard format and tagging requirements, and is therefore specifically focused on implementation and enforcement. Standardising the content of corporate computations is being worked on separately.

What is changing?

Currently, companies have a degree of flexibility in how their corporation tax computations are prepared and tagged when submitted with the CT600 and statutory accounts. HMRC believes that over time, this flexibility has led to inconsistent formats, missing information, and data that is difficult to analyse, both for taxpayers and HMRC systems. 

To address this, HMRC is proposing:

• Standardised format: A fully prescribed (standardised) format for corporation tax computations, with mandatory data fields and consistent XBRL tagging. HMRC is proposing to block submissions that don’t meet standards, meaning non-compliant returns would not be able to be submitted. 
• Mandatory online filing: For amended company tax returns, mandatory online filing is being proposed to replace some existing paper-based or informal amendment processes. HMRC estimate 95% of amendments are filed online, but they want this to be increased to reduce errors and delays from manual processing. There will be some exceptions for periods under enquiry, joint amended returns (simplified group relief arrangements), or where HMRC’s online service has gone down. 
• Approved software: Stronger enforcement mechanisms to ensure only compliant software and submissions are accepted through the implementation of an approved software list, where only products that pass HMRC testing will be included. Companies filing a non-compliant return will be directed towards this list, and there is also the suggestion of levying penalties for non-compliant software providers, which is not a power HMRC currently has.

What is the likely impact on companies?

For many businesses, particularly those using mainstream tax software, the practical impact may be limited once systems are updated. However, the changes are likely to:

• Reduce flexibility in how tax computations are presented: Companies will have less discretion over the layout, structure and level of narrative included within tax computations. HMRC’s prescribed formats will standardise presentation, meaning bespoke layouts or alternative approaches will no longer be acceptable, regardless of internal preferences.
• Increase reliance on HMRC-approved software: Businesses will become more dependent on tax software that meets HMRC’s technical specifications. This may require upgrades or changes to existing systems, particularly where current processes involve spreadsheets, manual adjustments or bespoke solutions not designed for fully prescribed submissions, and there may be a cost implication connected with this. 
• Require more structured and complete data at the point of submission: Returns will need to include fully completed data fields and consistent tagging before submission. This places greater emphasis on getting calculations right the first time, with less scope to rely on explanatory narratives or supplementary documents to fill gaps or resolve ambiguities later.
• Limit the ability to submit informal or partial amendments after filing: As mentioned, HMRC intends to require amended returns to be submitted online and in the same standardised format. This reduces flexibility to make informal corrections by correspondence and increases the importance of ensuring the original return is accurate and complete.

Groups, complex entities and businesses using bespoke or spreadsheet-based processes may feel the impact more than others, as current approaches may require greater change to align with HMRC’s prescribed requirements.

Will standardisation increase enquiries? 

A key question being asked is – will standardisation increase the likelihood of an HMRC enquiry? 

HMRC stated the long-term objective is to improve the quality, consistency and comparability of corporation tax data and shift effort up front to prevent poor quality submissions rather than querying them later.

At present, HMRC has highlighted that inconsistent format and tagging mean key information is sometimes missing or ambiguous, which can trigger avoidable follow-up questions or enquiries. 

By mandating prescribed formats, consistent XBRL tagging, and more complete data, HMRC expects returns to be clearer and easier to analyse, reducing the need for clarification-driven enquiries where the tax position itself is not contentious. Therefore, fewer routine enquiries might be expected in the longer term. 

In the short to medium term, during transition, there may be increased scrutiny of whether returns meet the new technical standards, and possibly a higher risk of rejections or follow-ups where tagging or format requirements aren’t met, particularly for more complex businesses or bespoke filings. Expectation would be that these would typically be process-driven checks, rather than full enquiries.

Standardised data should make it easier for HMRC systems to:

• compare similar businesses
• identify outliers
• target cases for enquiry based on perceived risk.

This does not necessarily mean more enquiries overall, but it may mean that enquiries are more targeted, and businesses with unusual results, volatility or complex adjustments may face more focused questions than under the current system. 

For businesses, it will therefore be important to produce well-prepared returns that follow the prescribed format to reduce the risk of triggering basic enquiries. However, errors, inconsistencies or atypical results may be more visible, and there will be less scope to rely on narrative explanations alone where data fields are mandatory.

This change is not designed to make HMRC more aggressive, but it does reinforce the importance of robust tax computations, accurate data and tagging, as well as aligned accounts, computations and disclosures. Businesses that invest in getting this right should see fewer routine challenges over time. Those relying on manual processes or informal workarounds may face more friction during the transition.

When will this happen?

HMRC has made clear that this is a phased, multi-year change, not an immediate requirement. The consultation is open until 2 June 2026, and the current proposed timetable is as follows, recognising that businesses and software providers will need time to implement and adapt.

• April – September 2026 – development and consultation during 2026. HMRC will decide what they are going to prescribe for computations and will work with a group of specialist representatives from agents and software providers to finalise this.
• End of September 2026 – final technical specifications are expected to be ready by this time for a build period. 
• October 2026 – September 2027 – a build and testing period through 2027, with live pilots thereafter. 
• October 2027 – September 2028 – all returns will be required to conform to the new rules, but enforcement won’t yet begin, so that any issues can be identified. 

What should businesses do now?

Although no immediate action is required, early preparation will help minimise disruption later. We recommend that businesses:

1. Monitor developments as HMRC confirms final requirements and timelines.
2. Engage with agents and software providers to understand their readiness for standardised computations.
3. Review current tax return processes, particularly where manual adjustments or bespoke formats are used.
4. Consider responding to the HMRC consultation if the proposals are likely to significantly affect your business.

Crowe will continue to track the consultation and HMRC’s response and will provide further updates as the position becomes clearer. If you would like to discuss how these proposals may affect your business or group, please get in touch with your usual Crowe contact.