SME Tax News September 2026: MTD Auto-Enrolment, Corporation Tax Changes & the Budget Ahead
From £300 inc VAT Author: Sam Published: 7 September 2026
September is an important month for growing SMEs and limited companies. HMRC is beginning to auto-enrol eligible sole traders and landlords into Making Tax Digital for Income Tax, the Corporation Tax filing process has moved to commercial software, and the government has opened a consultation on reducing corporate reporting red tape.
The Autumn Budget is also scheduled for 28 October 2026. While no one can confirm future tax changes before the Chancellor speaks, growing businesses should review their records, tax reserves and planned investments now.
This guide explains the key developments and the deadlines that business owners need to understand.
1. HMRC begins auto-enrolling taxpayers into MTD
From September 2026, HMRC is beginning to automatically sign up sole traders and landlords who should already be using Making Tax Digital for Income Tax but have not registered themselves.
The first group includes people whose combined gross income from self-employment and property was more than £50,000 in 2024/25. The requirement applies from 6 April 2026.
Although MTD for Income Tax does not directly apply to a limited company, it can affect company directors personally. For example, you may:
Run a limited company while also operating a sole-trader consultancy.
Receive rental income alongside your company income.
Own property jointly with a spouse or civil partner.
Carry out a separate business activity outside your company.
Automatic enrolment is not a new deadline or a relaxation of the rules. It simply means HMRC is registering taxpayers who have not signed up themselves.
Registration alone is not compliance
Being registered for MTD does not complete your obligations. In-scope taxpayers must:
Keep digital records from 6 April 2026.
Use compatible software.
Send quarterly updates to HMRC.
Keep evidence supporting income and expenses.
Complete the relevant annual tax return and final declaration.
Quarterly updates are summaries of income and expenses, not tax returns. If HMRC enrols you in September, you may still need to bring your records up to date from 6 April and deal with any missed quarterly submission.
The next key quarterly deadline is 7 November 2026, covering the period from 6 July to 5 October 2026. If the first update due on 7 August was missed, deal with it promptly rather than waiting for another HMRC message.
What should directors do?
Check your 2024/25 Self Assessment records and add together relevant self-employment and property income. If the total was above £50,000, review your MTD position now.
An accountant can also check whether:
Your software is MTD-compatible.
Your digital records contain all transactions from 6 April.
The correct income sources are linked to HMRC.
Your business and personal records are being kept separately.
Any exemption may apply.
Searching for an accountant near me can be a useful starting point if you want local support with both company accounts and personal tax reporting.
2. Corporation Tax filing is now software-only
The free HMRC and Companies House online filing service for company accounts and Corporation Tax returns was discontinued from 1 April 2026.
Companies must now generally use HMRC-recognised commercial software to file their CT600, computations and relevant tagged accounts. Paper filing remains available only in limited circumstances, such as where a company has a reasonable excuse or is filing in Welsh.
This does not mean directors can no longer file their own returns. It means the filing method has changed. A company may still self-file, but it must use suitable commercial software rather than the old free online portal.
For a growing limited company, this makes it important to confirm that your bookkeeping or accounts package can:
Prepare the CT600.
Produce the required tax computation.
Submit the return electronically.
Handle tagged accounts where required.
Keep a clear record of successful submission.
The 2026 rules also bring tougher consequences for late filing. Corporation Tax late filing penalties have been doubled, so companies should not treat the filing deadline as an administrative detail. Your Corporation Tax return is normally due 12 months after the end of the accounting period, while payment is generally due nine months and one day after the period ends for companies outside the quarterly instalment regime.
Corporation Tax rates remain unchanged for 2026/27
The main Corporation Tax rates remain:
19% for companies with profits up to £50,000, subject to the associated company rules.
25% for companies with profits above £250,000.
Marginal relief for profits between £50,000 and £250,000, with an effective rate of up to approximately 26.5% across the marginal band.
The figures are not the only issue. Associated companies, accounting periods shorter or longer than 12 months, losses, capital allowances and dividends can all affect the final position.
A good corporation tax accountant should help you forecast the liability rather than simply calculate it after the year has ended. That review may cover:
Planned equipment or vehicle purchases.
Director salary and bonus decisions.
Employer pension contributions.
Dividend timing.
Loss relief.
Research and development claims.
The company’s tax reserve.
Do not assume that cash in the bank is available for dividends. The company must have sufficient distributable profits after considering its liabilities.
3. The 28 October Budget is approaching
The UK Budget is scheduled for Wednesday 28 October 2026. Until then, limited companies should plan using the rules currently in force and avoid making expensive decisions based on rumours.
Before the Budget, growing SMEs should prepare a short list of decisions that may be affected by future announcements, including:
Whether to bring forward planned capital investment.
Whether to recruit employees or contractors.
Whether to change director remuneration.
Whether to retain profits in the company.
Whether to pay dividends before or after the Budget.
Whether to revise pricing or cashflow forecasts.
This does not mean every business should rush to spend money or extract profits. A company should consider the commercial purpose, available cash and long-term plan before taking action.
A business accountant UK service can model different options and show the potential Corporation Tax and personal tax consequences before a decision is made.
4. Corporate reporting simplification consultation opens
The government has launched a consultation on 7 September 2026 aimed at simplifying corporate reporting and reducing unnecessary red tape for SMEs.
The proposals are expected to consider:
Making annual reports and accounts more proportionate.
Reducing duplicated financial and strategic reporting.
Making corporate governance reporting more flexible.
Reviewing requirements for private companies.
Supporting digital-first communication with shareholders.
Exploring whether some medium-sized companies could qualify for audit exemption.
Modernising complex company law and reporting requirements.
The consultation is part of a wider effort to reduce administrative costs for smaller businesses. However, these are proposals, not immediate changes to the law.
Limited companies should continue preparing and filing accounts under the current requirements until any final measures are announced and implemented.
The practical lesson is to keep accurate records even if reporting rules may become simpler. Better bookkeeping, organised evidence and timely management accounts will make future reporting easier, not harder.
5. Three dates to put in your calendar
5 October 2026: Self Assessment registration
If you needed to complete a Self Assessment tax return for the 2025/26 tax year and have not previously registered, you generally need to notify HMRC by 5 October 2026.
This may affect company directors with additional income from property, investments or self-employment. Use the HMRC Self Assessment deadlines reference to check the wider timetable.
28 October 2026: UK Budget
The Budget may introduce changes affecting Corporation Tax, investment allowances, employment costs or personal tax. Avoid making decisions based solely on speculation, but prepare your figures so you can respond quickly when announcements are made.
7 November 2026: MTD quarterly update
In-scope sole traders and landlords must prepare for the next MTD quarterly update deadline. Digital records should cover the relevant period and be supported by invoices, receipts and bank information.
Practical September action list for SMEs
Growing limited companies should consider taking these steps:
Check whether any director has personal income that brings them into MTD.
Confirm that digital records are complete from 6 April 2026 where required.
Check that the company uses commercial software for its CT600 filing.
Review the Corporation Tax payment and filing deadlines.
Reconcile bookkeeping, payroll, VAT and bank records.
Update the Corporation Tax reserve using current profit forecasts.
List investment, dividend and remuneration decisions before the Budget.
Review whether the 5 October Self Assessment registration deadline applies.
Prepare for the 7 November MTD quarterly update.
Speak to accountants for small business before a deadline becomes urgent.
Accountant Search is a curated directory and digital matchmaking and referral platform. We connect growing SMEs and limited companies with accountants who may be suitable for their needs. We are not an accountancy practice and do not provide accounting advice directly.
If you are searching for an accountant near me, use our find an accountant service. You can also explore support from a limited company accountant.
Self-Assessment tick-box
Self-Assessment tick-box: Check whether you need to register for Self Assessment by 5 October 2026, whether your combined self-employment and property income exceeds the MTD threshold, and whether any quarterly update is outstanding.
Confirm whether you need to complete the SA registration form.
Keep company and personal income records separate.
Retain evidence of all income, expenses and tax submissions.
If you need help reviewing your position, complete the SA registration form through our Self-Assessment accountant service. Accountant Search can help match you with an accountant who understands personal tax requirements alongside the needs of a growing limited company.
This article is for general information only and reflects the position understood on 7 September 2026. Tax rules and proposed measures can change. Obtain professional advice based on your circumstances before making financial or tax decisions.
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