ChatGPT, Microsoft Co-Pilot and Gemini are among the AI tools that have gained significant traction this year with many people using them to draft emails, review CVs and even provide tax advice. But is this trust in AI justified or could it be damaging to businesses?

Why people are using AI for tax advice

New research by European tax platform Taxfix suggests that 59% of Brits plan to use AI to submit their annual tax return, believing that it will save them time and money compared to using an accountant.

Risks associated with trusting AI’s tax advice

Though accountants in Chippenham and beyond understand why, during an economic downturn, the public is placing its faith in AI tools and technologies, they urge caution as the systems do not understand the nuances of British tax law and can put them at risk of overpayments, penalties and fines.

The areas in which AI tools most commonly produce errors are interpretation of business expenses, VAT claims, personal tax planning, payroll errors and business tax planning. When clients use AI to prepare their books, they place a greater burden on their accountants Chippenham who need not only to verify the data but unpick and resolve the AI-generated errors before they can submit, and this takes time and costs more money.

Conclusion

AI tax advisors are potentially damaging to British businesses, delivering flawed advice and recommendations that not only put them at risk of fines and penalties, but also cost them more in accountants fees due to the poor quality data they produce.