HMRC CT600 Online vs Software: Which Is Better?
If you're filing a CT600 for your limited company, you've got a choice to make: use HMRC's own online service, or go with commercial filing software. Both get your return to HMRC — but the experience, cost, and risk of errors couldn't be more different.
This guide gives you an honest comparison of HMRC's CT600 online filing service versus dedicated software like TaxPipe, so you can decide which approach suits your company.
The Two Filing Routes Explained
HMRC's CT600 Online Service
HMRC provides a free online service through the Government Gateway that lets you file your Company Tax Return directly. It's been available for years and handles basic CT600 filings.
What it offers:
- Free to use (no subscription or per-filing fees)
- Direct submission to HMRC
- Basic CT600 form completion
- Available 24/7 through the Government Gateway
Commercial Filing Software
Dedicated CT600 software — like TaxPipe — is built specifically to make corporation tax filing faster, easier, and less error-prone. These tools handle the CT600, iXBRL accounts, and HMRC submission in one workflow.
What it offers:
- Guided step-by-step filing process
- Automatic calculations (tax, marginal relief, capital allowances)
- iXBRL accounts generation built in
- Error checking before submission
- Support and help resources
Feature-by-Feature Comparison
Let's break down the key differences:
1. Cost
| Option | Price |
|---|---|
| HMRC online | Free |
| Commercial software | Typically £50–£200 per filing |
HMRC's service is free — that's its biggest selling point. But free doesn't mean cheap if it takes you hours longer or leads to costly mistakes.
The real cost calculation: If HMRC's service takes you 3–4 extra hours compared to software, and your time is worth even £20/hour, you've already spent more than most software costs. Factor in potential penalties from errors, and "free" can become expensive.
2. iXBRL Accounts
This is where the biggest gap appears. Since April 2011, all Company Tax Returns must include accounts in iXBRL format — a tagged, machine-readable version of your financial statements.
HMRC online: Does NOT generate iXBRL accounts. You must prepare and tag your accounts separately using another tool, then upload them. This is a major pain point — you essentially need separate software anyway just for the accounts portion.
Commercial software: Generates iXBRL accounts automatically as part of the filing process. You enter your figures, and the software handles the tagging, formatting, and submission. No separate tools needed.
This is the dealbreaker for most filers. If you need iXBRL accounts (and you do), HMRC's free service only covers half the job. You'll still need software for the accounts — making the "free" route less free than it appears.
3. Ease of Use
HMRC online: The interface follows the CT600 form structure — box by box. If you know exactly which boxes to fill in and what figures go where, it works. But there's minimal guidance. You're expected to understand corporation tax terminology, know which supplementary pages apply, and calculate figures yourself.
Commercial software: Designed for people who aren't tax experts. Good software asks plain-English questions ("What was your turnover?", "Did you have any capital purchases?") and fills in the correct CT600 boxes automatically. You don't need to know that turnover goes in Box 145 — the software handles the mapping.
4. Error Prevention
HMRC online: Basic validation only. It'll flag if you've left a required box empty or entered text where a number should be, but it won't catch logical errors. For example:
- It won't warn you if your expenses exceed turnover in a way that suggests a mistake
- It won't flag if you've forgotten to claim marginal relief when eligible
- It won't check your accounts figures against your CT600 for consistency
Commercial software: Built-in error checking catches problems before submission:
- Cross-checks between accounts and CT600 figures
- Alerts for common mistakes (wrong accounting period, missing reliefs)
- Validation against HMRC's submission rules
- Prompts for claims you might be entitled to
5. Marginal Relief and Tax Calculations
Since April 2023, the corporation tax rate depends on your profit level — 19% for profits under £50,000, 25% for profits over £250,000, and a sliding scale between. This requires a marginal relief calculation.
HMRC online: You must calculate marginal relief yourself and enter the correct figure. Get the calculation wrong, and you'll overpay or underpay tax.
Commercial software: Calculates marginal relief automatically based on your profits and the number of associated companies. One less thing to get wrong.
6. Capital Allowances
If your company has purchased equipment, vehicles, or other qualifying assets, you need to calculate capital allowances — including the Annual Investment Allowance.
HMRC online: You calculate allowances manually and enter the figures. You need to know the correct rates, pools, and qualifying criteria.
Commercial software: Walks you through asset purchases and calculates allowances automatically. Handles AIA, writing down allowances, and small pools relief.
7. Record Keeping and History
HMRC online: Once submitted, you can view your return through HMRC's systems. But you don't get a local copy of your working papers or an easy way to reference previous years when preparing next year's return.
Commercial software: Stores your filing history. When you file next year, you can pull forward prior-year figures — opening balances, brought-forward losses, capital allowance pools — saving significant time.
8. Support
HMRC online: General HMRC helpline (long wait times). No specific support for using the online filing tool. Help pages exist but tend to be generic.
Commercial software: Dedicated support teams who understand both the software and the tax rules. In-app guidance, help articles, and often live chat or email support.
When HMRC Online Makes Sense
To be fair, HMRC's online service works acceptably if:
- Your company is dormant and you're filing a nil return (no accounts needed)
- You already have iXBRL accounts prepared by an accountant and just need to file the CT600 itself
- You're very comfortable with corporation tax and the CT600 form structure
- Cost is your absolute top priority and you value your time at zero
For dormant company filings specifically, HMRC's service handles the basics. But even here, you still need to navigate the Government Gateway, which many people find frustrating.
When Software Is the Better Choice
Software makes more sense when:
- You need to generate iXBRL accounts (which is almost every active company)
- You're not a tax expert and want guided filing
- You want automatic calculations for marginal relief, capital allowances, and tax due
- You're filing for a trading company with real income and expenses
- You want error checking before submission
- You plan to file yourself going forward and want prior-year data carried forward
For the vast majority of small limited company directors filing without an accountant, software is the practical choice.
Cost Comparison: The Full Picture
Let's look at real costs for a typical small company filing:
| Approach | Direct cost | Time cost (est.) | Risk cost | Total effective cost |
|---|---|---|---|---|
| HMRC online + separate iXBRL tool | £0–£100 for iXBRL | 6–10 hours | Higher error risk | £150–£400+ |
| Dedicated filing software | £50–£150 | 2–4 hours | Lower error risk | £90–£230 |
| Accountant | £500–£1,500 | Minimal | Lowest risk | £500–£1,500 |
The "free" HMRC route often costs more in total when you factor in time and the need for separate iXBRL software. Dedicated filing software hits the sweet spot — significantly cheaper than an accountant, significantly faster than doing everything manually.
What About HMRC's Free Filing Service Ending?
HMRC has been winding down some free filing options. While the core CT600 online service remains available, the landscape is shifting toward commercial software as the standard filing route. HMRC itself recognises that most companies benefit from using software that handles both the CT600 and iXBRL accounts in one package.
Making the Switch to Software
If you've been struggling with HMRC's online service (or dreading the process), switching to software is straightforward:
- Gather your documents — use our CT600 filing checklist
- Choose your software — compare options
- Enter your figures — follow the guided process
- Review and submit — the software handles HMRC submission
With TaxPipe, the process takes most small company directors 2–3 hours from start to submission. No tax knowledge required — just your accounts figures.
Frequently Asked Questions
Can I file my CT600 for free?
Yes — HMRC's online service is free for the CT600 itself. However, you'll still need iXBRL-tagged accounts, which typically requires separate software. Truly free end-to-end filing is very limited. See our guide to free CT600 filing options.
Is HMRC's online CT600 service being discontinued?
HMRC hasn't announced a full shutdown, but they've been reducing free filing options and encouraging the use of commercial software. The trend is clearly toward software-based filing.
Do I need iXBRL accounts to file a CT600?
Yes — all active companies must submit accounts in iXBRL format with their CT600. Dormant companies filing nil returns may not need full accounts. Read more about iXBRL requirements.
What's the cheapest way to file my CT600?
Dedicated filing software that handles both the CT600 and iXBRL accounts typically offers the best value. See our cheapest filing options guide.
Can I switch from HMRC online to software mid-way?
Yes. If you've started on HMRC's service but want to switch, you can simply start fresh in your chosen software. Nothing is locked in until you submit.
How long does it take to file a CT600 with software vs HMRC online?
Most users report 2–4 hours with dedicated software versus 6–10 hours using HMRC's online service (plus separate iXBRL preparation). The time saving comes from guided workflows, automatic calculations, and integrated accounts preparation.
The Bottom Line
HMRC's CT600 online service is "free" in the narrowest sense — but for most active companies, it only covers half the job. You'll still need iXBRL accounts, you'll still need to calculate everything manually, and you'll still face the risk of errors without proper validation.
Dedicated filing software costs a fraction of an accountant's fees while doing most of the heavy lifting for you. For the majority of small company directors, it's the practical sweet spot between fully DIY and fully outsourced.
Ready to try the easier route? Start your CT600 filing with TaxPipe — guided, automatic, and submitted directly to HMRC.