On 2 July 2026, HMRC published its annual Transformation Roadmap progress update, outlining the most significant modernisation of the UK tax system in a generation. For Italian businesses operating in the UK — or considering a presence in London — understanding these changes is not optional. It is essential for staying compliant, reducing administrative costs and making the most of the new digital tools now available.
Making Tax Digital is now live — and expanding
The most significant change already in effect is the launch of Making Tax Digital (MTD) for Income Tax in April 2026. Furthermore, MTD now applies to sole traders and landlords with gross income above £50,000, requiring digital record keeping and quarterly submissions to HMRC through compatible software. Moreover, the threshold will drop to £30,000 in April 2027 and to £20,000 in April 2028 — meaning the vast majority of self-employed individuals and small business owners will be affected within two years.
Over 350,000 businesses have already signed up. Additionally, HMRC’s evaluation of MTD for VAT — already in operation since 2019 — shows that digital record-keeping has reduced errors and saved businesses between 26 and 40 hours per year on average. As a result, early adoption is strongly advisable.
78% of HMRC interactions are now digital
HMRC has made rapid progress toward its goal of 90% digital customer interactions by 2030. Specifically, 78% of all interactions now take place through digital or automated channels, up from 65% five years ago. Consequently, the HMRC app now has 7.6 million unique users, and nearly 20 million people use the Personal Tax Account.
For businesses, this means that most routine tax matters — from viewing payment schedules to managing VAT and Self Assessment — can and should be handled digitally. Therefore, companies without a properly set-up digital tax account risk delays and additional administrative burden.
Tax adviser registration is now mandatory
From May 2026, registration with HMRC is mandatory for all tax advisers who interact with the authority on behalf of clients. Additionally, from April 2026, HMRC introduced stronger powers and tougher penalties for advisers who facilitate non-compliance. As a result, Italian businesses should verify that their UK tax adviser or accountant is fully registered and compliant with the new standards.
E-invoicing is coming — prepare now
HMRC has confirmed that e-invoicing will be mandatory for all VAT invoices from April 2029. Furthermore, a detailed implementation roadmap will be published at Budget 2026. Therefore, businesses that begin integrating compatible systems now will be significantly better positioned when the deadline arrives.
Compliance enforcement is increasing significantly
HMRC is on track to recruit 5,500 additional compliance officers by 2029 to 2030. Moreover, over 2,100 have already been hired, with a further 1,100 planned for 2026 to 2027. In addition, AI-powered tools are being deployed to identify discrepancies, and a strengthened reward scheme for informants targeting serious non-compliance has been launched. Consequently, the risk of non-compliance — including for foreign-owned businesses operating in the UK — is higher than ever.
What this means for Italian businesses in the UK
The HMRC Transformation Roadmap represents a clear direction of travel: a digital-first, AI-enabled, compliance-focused tax authority. For Italian businesses operating in London or elsewhere in the UK, the practical implications are significant.
Specifically, companies need to:
- ensure their accounting and bookkeeping software is MTD-compatible
- verify their UK tax adviser is registered under the new mandatory scheme
- prepare for e-invoicing integration ahead of the April 2029 deadline
- review their digital tax accounts and ensure all records are up to date
- understand the implications of increased HMRC compliance activity
How Kelmer Group can help
Navigating the evolving UK regulatory landscape requires expertise, local presence and up-to-date knowledge of HMRC requirements. Kelmer Group supports Italian businesses through tax advisory, accounting, company formation and regulatory compliance in the UK — helping you stay ahead of the changes and focus on growing your business.
📩 Contact our London team at kelmer.com