Software Can Avoid Errors in CT Returns

07 March 2006

NAO reports a 40 per cent error rate in CT Returns.

Practitioners, who fail to invest in software capable of dealing with increasingly complex corporation tax regulations, are inevitably exposing themselves to the risk of error on the returns they submit according to accountancy software developer Digita.

The claim follows the revelation from the National Audit Office (NAO) that as much as 40 per cent of corporation tax returns are wrong and that there is scope for further improvement which

"hinges… on being able to tackle some of the underlying reasons for non-compliance"

The main ‘underlying reason’ according to Laura Brutti, Digita Corporation Tax Product Manager, is a reliance on basic form-filling software that can’t cope with complex computations leading to human error.

Digita Corporation Tax has been designed to enable practitioners to complete CT600 forms using software that has all the necessary forms in place to comply with the latest HMRC requirements and is upgraded as soon as new rules are introduced.

Digita Corporation Tax completes both the tax computation and the relevant tax forms for all chargeable periods created. It knows which values should be entered; therefore, it minimises risk by highlighting errors.

Laura Brutti said:

"Practitioners are under extreme pressure at tax return time, so errors are easily made and a small error can have disproportionate consequences with the potential for a full HMRC enquiry costing both practice and client unnecessary time and expense."
At Digita, we have designed our software to minimise the risk of non-compliance and lift the burden from practitioners. Digita Corporation Tax is so much easier to use than an inherently risky spreadsheet-based solution.

HMRC is doing its utmost to minimise these high levels of non-compliance as pointed out in the NAO press release which states that:

"The Department (HMRC) has introduced various measures to help businesses submit compliant returns, such as a shorter tax form for companies with simpler financial affairs, an electronic return with inbuilt checks, and working with some companies to resolve issues before they submit their returns."

Digita is working hard by investing in the continued development of Corporation Tax to avoid error-prone returns in the first place. To see this and other great developments, come to the Digita Annual Conference; visit for more information.

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