The Government’s ‘Company Accounts and Tax Online’ (CATO) filing service will cease operations on March 31, 2026. This service has enabled small companies to file their accounts and corporation tax returns simultaneously with Companies House and HMRC at no charge. Following its closure, companies will be required to use commercial software or hire a professional accountant for filing. This change significantly affects micro-entities and small businesses that currently handle their filings independently.
Although a free web-filing service from Companies House may still be available for micro-entity or dormant accounts, it is limited to statutory accounts and is also expected to be discontinued soon. Companies are advised to prepare for this transition in advance to avoid last-minute complications and potential errors that could lead to penalties.
For businesses whose deadlines fall shortly after the closure date, early filing is encouraged to ease the transition. By submitting filings before CATO closes, companies could extend their timeline for adapting to new processes.
Regardless of filing plans, the Government suggests that users back up all previously submitted accounts and tax returns via the CATO portal before its closure, as access to past submissions will no longer be available afterward.
Working with an accountant or bookkeeper will be essential for many small businesses during this transition. These professionals can assist with software selection, ensure compliance, and streamline the year-end process, making it less stressful and more efficient.
This shift serves as a crucial opportunity for businesses to reassess their accounting practices and ensure they are equipped for future requirements.
Why this story matters
- The closure of CATO impacts the filing processes for many small businesses, requiring them to adjust quickly.
Key takeaway
- Businesses should prepare for the transition by considering professional accounting help and filing early if possible.
Opposing viewpoint
- Some may argue that the increased reliance on commercial software or accountants adds unnecessary costs for small business owners who previously managed their accounts independently.
