Last reviewed: May 2026
Quick answer: UK business software choices are shaped by HMRC Making Tax Digital, UK GDPR, the need for UK PAYE / RTI compliance, and (for sector-specific software) FCA regulation. The gov.uk HMRC-recognised software list identifies MTD-ready products.This guide addresses "comero" using the UK regulatory framework that shapes business software choices: HMRC Making Tax Digital, UK GDPR and the Data Protection Act 2018, and (for payroll) Real Time Information.
HMRC Making Tax Digital compliance
MTD for VAT: all VAT-registered businesses must keep digital records and submit VAT returns through HMRC-recognised software (since April 2022, regardless of turnover).
MTD for ITSA: phases in April 2026 (qualifying income over £50,000) and April 2027 (over £30,000) for sole traders and landlords. Quarterly updates plus final declaration replace the annual Self Assessment for those in scope.
HMRC publishes the list of MTD-recognised software at gov.uk/government/publications/find-software-suppliers-for-mtd. The list is updated as new products become MTD-compliant.
Payroll: Real Time Information
PAYE Real Time Information requires every payroll run to be submitted to HMRC on or before payment to the employee. Payroll software must support RTI; manual submissions are not normally accepted.
The Full Payment Submission (FPS) reports each pay run. The Employer Payment Summary (EPS) reports adjustments and recoverable amounts. Both go to HMRC through the software.
Auto-enrolment integration: payroll software normally integrates with workplace pension providers (NEST, The People's Pension, Smart Pension, etc.) for the 5 per cent + 3 per cent contributions.
UK GDPR and data protection
Software handling personal data (employee records, customer data, supplier contacts) must comply with the UK GDPR and Data Protection Act 2018. The Data Processing Agreement under Article 28 is required.
Where data is hosted matters: UK or EU hosting is simpler for transfer compliance. US hosting (and other non-adequate jurisdictions) requires Standard Contractual Clauses (SCCs) and a Transfer Risk Assessment.
Data subject rights (access, rectification, erasure) need to be operationally supported. Check the software's data subject request handling before buying.
Security: certifications and basics
SOC 2 Type II and ISO 27001 are the industry-standard security certifications. UK-specific Cyber Essentials Plus is a useful additional signal, particularly for software handling sensitive data.
Multi-factor authentication (MFA) should be available for all users. Single Sign-On (SSO) integration with Microsoft 365 or Google Workspace simplifies user management.
Encryption at rest and in transit is now standard; check the supplier's security documentation. Penetration testing reports may be available under NDA for enterprise customers.
Choosing and switching
Pilot before purchase: 30-day free trial or starter tier lets you test actual workflows. Check integration with bank, payroll, expenses, and your existing stack.
Switching cost: data export in usable format (CSV, Excel) must be available. Plan switches around year-end to avoid mid-year reconciliation problems.
Support quality matters more than headline features for business-critical software. Check Trustpilot and G2 reviews for real-world experience. UK-hours support is preferable to overnight email queues.
Where to get further help and how to escalate
If the council cannot resolve your Council Tax issue through its own complaints process, you can escalate to the Local Government and Social Care Ombudsman, an independent body that investigates complaints about local councils. The Ombudsman is free to use and does not require legal representation.
For independent debt advice on Council Tax arrears, free help is available from Citizens Advice (national phone line, webchat and in-person service), National Debtline (free phone line and webchat run by the Money Advice Trust) and StepChange (free phone line and online advice). All three can speak to the council on your behalf with your written authority.
For premium-rate phone number complaints, the Phone-paid Services Authority handles regulation of premium rate services in the UK. For Council Tax scams or fraudulent demands, report to Action Fraud, the UK national reporting centre for fraud and cybercrime.
If you are facing enforcement and need to pause the collection process to get advice, the Breathing Space (Debt Respite Scheme) provides up to 60 days of legal protection from creditor action while you work with a debt adviser. A separate Mental Health Crisis Breathing Space lasts as long as you are receiving treatment for a mental health crisis, plus 30 days afterwards.
The council must, under the Equality Act 2010 and the Public Sector Bodies (Websites and Mobile Applications) Accessibility Regulations 2018, make reasonable adjustments for residents with disabilities. Ask for the format that works for you (large print, audio, Braille, BSL interpretation, plain English) if the standard channels are not accessible.
If you have moved house recently and you are unsure whether the old or the new council is the right one to contact, check both: each council's online "Council Tax when you move" page sets out the date from which it considers you liable. The old council closes the account at your move-out date and the new council opens an account from your move-in date; the two are normally the same day, and any gap is dealt with by the owner of the empty property.
For Council Tax questions specific to your circumstances (self-employed income, disability registration, recent bereavement, complex household arrangements, foster placements, military service or shared custody), ask the council in writing or by phone rather than relying on a general guide. The council's benefits team handles individual assessments and can give a binding answer for your account.
If the council's decision is final and you disagree, the Valuation Tribunal for England (and the equivalents in Wales and Scotland) hears appeals on liability and banding free of charge. You do not need legal representation; the tribunal is designed for unrepresented applicants.
Worked example: how the framework applies in practice
Take a typical case: a single working-age adult living alone in a Band C home. They qualify for the 25 per cent single person discount, which reduces the Council Tax bill to 75 per cent of the full Band C rate. If they receive Universal Credit, they may also qualify for Council Tax Reduction, which is calculated on the post-discount bill.
Now add a second adult who moves in: the single person discount stops from the move-in date. The bill returns to the full Band C rate (with any Council Tax Reduction recalculated on the new household total income). If the second adult is a full-time student, they are disregarded and the single person discount continues.
If the household later moves to a Band D home in the same council, the same discount and reduction logic applies but to the higher band amount. If the household moves to a different council, the discount, reduction and any payment plan need to be re-established with the new council; the move forms on both council websites handle this together.
For an empty property, the rules invert: the owner becomes liable from the day the property is unoccupied and unfurnished. Empty home premiums apply after 12 months. Bringing the property back into occupation resets the clock and removes the premium from the next instalment.
If the household falls into arrears, the recovery sequence is fixed: 7-day reminder, loss of right to instalments, full year balance due, 14-day final notice, court summons, liability order, enforcement. Engaging with the council before the summons normally produces a payment plan that keeps the case out of court.
Frequently Asked Questions
What is Making Tax Digital?
HMRC's programme to digitise UK tax. MTD for VAT applies to all VAT-registered businesses (since April 2022). MTD for Income Tax Self Assessment phases in from April 2026 for sole traders and landlords with qualifying income over £50,000.
Do I need HMRC-recognised software for VAT?
Yes, if VAT-registered. The HMRC software list at gov.uk identifies recognised products. Bridging software lets you submit from spreadsheets if the spreadsheet keeps digital records compliant with MTD rules.
What are the UK GDPR rules for business software?
Software processing personal data must comply with UK GDPR and the Data Protection Act 2018. The Data Processing Agreement (DPA) under Article 28 is required between you (Controller) and the software provider (Processor).
How long should business records be kept?
HMRC requires accounting records for at least 6 years (companies) or 5 years from the 31 January submission deadline (self-employed). VAT records: 6 years. Payroll: 3 years for HMRC, longer for employee dispute purposes.
Where can I get free advice on UK business software?
Trade bodies (Federation of Small Businesses, ICAEW, ACCA, AAT), the HMRC software list at gov.uk, and free trials let you test before committing. Independent reviews on Trustpilot and G2.
How We Verified This
UK business software framework verified against HMRC Making Tax Digital guidance, the UK GDPR (UK Data Protection Act 2018), HMRC PAYE Real Time Information guidance, the Pensions Act 2008 (auto-enrolment), and the published HMRC list of MTD-recognised software.
