HMRC closes online accounts and tax filing service

HMRC’s has decided to terminate its online tax filing services and Business Tax Accounts for small businesses and self-employed individuals with turnovers below the VAT threshold (£90,000 as of March 2025). This change, effective from April 2025, aligns with the Making Tax Digital (MTD) for Income Tax Self-Assessment (ITSA) initiative, requiring these businesses to use third-party commercial software for tax filings starting with the 2026/27 tax year. HMRC will no longer provide its free Basic Business Tax Account, pushing businesses to adopt digital solutions compatible with MTD ITSA requirements, such as quarterly reporting and year-end submissions via approved software. The article highlights the abruptness of this shift, the lack of a free HMRC alternative, and the challenges it poses for small businesses unprepared for the transition, especially those reliant on HMRC’s previous online tools.

How Llama Accounting Can Help UK Small Businesses

Llama Accounting, as a provider of accounting software and services, can directly address the challenges outlined in the article by offering tailored support for UK small businesses affected by HMRC’s closure of its online accounts and tax filing services. Here’s how:

        1       MTD-Compliant Software: Llama Accounting can provide small businesses with user-friendly, MTD ITSA-compliant software to seamlessly transition from HMRC’s defunct services. This ensures businesses meet the quarterly reporting deadlines (four updates plus an End of Period Statement) starting in April 2026, avoiding penalties and compliance issues.

        2       Affordable Digital Transition: With HMRC no longer offering free tools, small businesses face the cost of commercial software. Llama Accounting can offer cost-effective solutions, potentially with tiered pricing or support packages, making the switch affordable for micro-businesses and sole traders below the VAT threshold.

        3       Education and Onboarding: The article notes the burden on businesses unfamiliar with digital tools. Llama Accounting can provide training, tutorials, or dedicated support to help owners understand and implement MTD requirements, easing the stress of adapting to new systems.

        4       Streamlined Record-Keeping: Llama’s software can simplify the process of maintaining digital records—a key MTD ITSA requirement—replacing the manual or basic systems businesses might have used via HMRC’s portal. Features like automated income/expense tracking and integration with bank accounts can save time and reduce errors.

        5       Proactive Compliance Support: With HMRC’s shift leaving some businesses scrambling, Llama Accounting can offer proactive guidance on deadlines (e.g., the 2026/27 tax year start) and ensure filings align with the new tax-year basis, helping clients avoid the confusion Cave describes.

By stepping in where HMRC has stepped back, Llama Accounting positions itself as a vital partner for small businesses navigating this mandatory digital shift, turning a potential headache into an opportunity for streamlined, modern tax management.

Llama Guides-Creating_a_business_tax_account.pdf

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