Why Avoid Using AI for Tax Advice
You would be hard-pressed to find an industry that hasn’t built up a reliance on AI for day-to-day support. However, although artificial intelligence is a proven way to help companies run efficiently, there are some areas where it can cause more harm than good.
In this article, we will explore the issues that can arise when using AI for tax advice and share how the Hysons team can help you manage all aspects of your financial responsibilities.
Issues Associated With Using AI for Tax Support
A recent survey by Taxfix found that 59% of Brits plan to use AI in the run-up to the 2025/2026 tax deadline. Whether this is as a way to calculate returns, understand more about Making Tax Digital, or to gain clarity on expense management, this can unfortunately lead to some major issues for taxpayers.
Here are the main reasons why AI should be avoided when managing tax obligations:
AI Is Not Guaranteed to Understand the Complex Nature of Tax
While AI may be able to supply basic explanations of tax codes, it cannot advise on the specific application of data and associated variables. Furthermore, to ensure AI is accurate, prompts need to include correct information, which most people simply won’t know when it comes to tax and finances.
Tax Information is Specific to Your Country and Position
UK taxpayers and businesses are subject to current legislation enforced by HM Revenue and Customs (HMRC). Most of the time, you will find that AI tools, such as ChatGPT, are US-focused. This means even if you include UK information in the prompts, results are not guaranteed to be in-line with the latest information from the correct governing body.
AI Answers Can Be Incorrect
Despite the fact that many people trust AI, surveys have found that around 45% of answers include incorrect details.
The platforms are guilty of sometimes providing the answers they think you want, not the accurate information. When it comes to details that need to be solid, such as tax planning, this can lead to major issues.
What’s the Alternative of Using AI for Tax Advice?
Even though AI can seem reliable, there really isn’t a replacement for working with a qualified accountant.
Tax professionals give you informed advice that is unique to your specific information. A tax advisor can give you tailored, bespoke information to ensure your tax remains clean and up-to-date.
Furthermore, as well as hiring an accountant to work on annual requirements such as self assessments and company tax returns, they can also provide support in other tax-applicable areas. This includes year-round tax planning and business support, understanding changes to tax rules, and much more.
AI can be a useful source of information if you want to understand the basics of tax, but it can never completely replace the support that an accountant offers. If you are keen to find out how our team can eliminate the concerns of AI, click here to get in touch.