The UK is heading into the first truly AI-led tax season. At Taxfix, we recently conducted a survey of people who file Self Assessment tax returns in the UK and found that 59% plan to use AI tools to help them complete their returns ahead of HMRC’s 31 January deadline.
The appeal is obvious: tax returns are notoriously painful, complicated, and require engaging with a jargon-infused system many find opaque and hard to navigate, while accountants are costly and not accessible to everyone.
Senior Director at Taxfix.
Tax isn’t the only area where this trend is taking hold. In fact, the largest ever study into consumer use of AI, recently published by OpenAI, found that in an analysis of 1.5 million conversations, almost half (49%) of users now use ChatGPT primarily as an advisor, rather than a task executor.
But when it comes to matters as highly technical, personal, and compliance-driven as tax, reliance on generic AI tools raises critical questions. What are the risks for those filing a Self Assessment tax return? What are the impacts on accountants? And what does this shift mean for HMRC’s role in the future of filing?
The realities of AI tax advice
Tax returns are stressful, so it’s no surprise that people are turning to AI tools, which have guided them through other admin-heavy processes in their lives, to help them fill out their tax return.
High street accountant fees are inaccessible for many, ranging from £300 to £500 for a simple return and HMRC is frequently criticized for its long hold times and poor customer service.
The top reasons people cited turning to AI were speed (39%), convenience (36%) and cost (33%), with 4 in 5 (79%) people saying AI reduces the stress and anxiety of tax season, which explains why so many people are experimenting with the technology.
But accurately completing a tax return isn’t just a form-filling exercise. Of the accountants surveyed, 73% believe AI provides incomplete advice, 62% say it struggles with nuance, and 52% point to a lack of UK-specific tax knowledge.
Part of the problem is also that those without technical training often don’t know what details to provide or which follow-up questions to ask to get the best information accurate to their specific financial situation out of the model.
This can easily lead to making the wrong judgment calls about allowances, reliefs and reporting obligations. In other words, mistakes that can quickly add up to costly penalties or simply leaving money on the table by not claiming back eligible tax.
As a digital tax platform that provides those responsible for their own tax returns with access to qualified accountants, we are seeing these AI-fueled mistakes crop up more and more. Recently, a client had incorrectly applied the £1,000 trading allowance when they should have claimed actual expenses.
Because their income level placed them in the 60% tax trap, the difference would have been significant. Human oversight here saved the client thousands.
The impacts on accountants
For the accountancy profession, the impact of AI is twofold. For decades, January has meant clients dropping off bags of receipts and spreadsheets onto paper-filled desks, leaving accountants to handle the laborious work of sorting and categorizing.
With new technologies, accountants still review and file tax returns themselves but can delegate the manual, routine work to AI.
Accountants can rely on these tools for everything from document management and data extraction to anomaly detection and translating technical rules into plain English for clients. Used internally, AI is a productivity boost that allows accountants to hand off many lower-value, repetitive and time-consuming tasks.
But, increasingly, AI is no longer only in the hands of professionals; it’s in the hands of clients too. And that changes the dynamics of client relationships. Taxpayers may now arrive with AI-fueled assumptions, convinced they already know what their return should look like.
Turning to AI is particularly on the rise among the younger generations. And it’s not just AI; our research revealed that nearly half of those filing their own tax returns (43%) are now researching tax tips on TikTok and YouTube.
Perhaps unsurprisingly, there’s a clear generational divide when it comes to embracing social media. More than half (58%) of those aged 18-24 prefer TikTok and YouTube for advice over HMRC (36%). Whilst those aged 55-64 agreed that HMRC is an important source of information for them (67%), when compared to less traditional forms of media (10%).
In practice, this means accountants will increasingly find themselves working with AI-informed clients and will need to validate, explain, and possibly correct what those clients bring with them. That demands both technical expertise and clear communication.
The hybrid future
Despite this clear behavioral shift, accountants are not being replaced. The evidence shows that while people value AI’s speed and accessibility, they also crave human reassurance. 81% of respondents said they still want access to a qualified professional when needed.
This creates a clear opportunity. Accountants can use AI to perform their day-to-day tasks more efficiently and have more time to help clients navigate complexity, provide peace of mind, and add value.
At the same time, adopting AI internally can allow tax professionals to give clients what they want: the user-friendliness, efficiency, and streamlined admin that have made AI tools so popular.
The winning formula, for self-assessors and accountants alike, is a hybrid approach: AI where it excels, and human oversight where it’s required.
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