How to use AI this tax time

Generative AI tools are now part of that mix. Publicly available generative AI chatbots and writing assistants like ChatGPT, Claude, Copilot and Google Gemini can answer questions, summarise documents and explain complex concepts in plain language.  

They are the tools that Aussies might be reaching for this tax time. They can help sort your receipts, explain the basics, and help you make sense of messy information. Used well, AI can make the end of the financial year faster and far less stressful. 

But there’s a catch, because generative AI tools can also get things confidently wrong. 

Here’s the balanced view: use AI to help you get organised and understand what you’re doing, but keep a person in charge of every figure you lodge. 

This is the most important point. 

Whether or not you use AI, you are responsible for the information in your tax return. The Australian Taxation Office (ATO) has been clear on this. If AI suggests a claim you’re not entitled to, or misses income, the responsibility still sits with you.  

If you want to build your skills and confidence when it comes to your tax obligations, check out the ATO’s self-paced learning on Essentials to strengthen your small business.

You can also access a range of tools and support services to help small businesses stay on track.

Generative AI tools pull from a broad mix of sources. That can include overseas tax rules or outdated information. The answer may look polished and sound certain, but still be wrong for Australians.

The practical approach is simple: use AI to help you think, research and prepare, then check the detail against the official ATO information before you lodge. 

Used as a support tool, generative AI earns its place at tax time. These tools are well-suited to preparation tasks – the kind of work that doesn't require a definitive legal answer. 
They can help you: 

• Get organised by sorting receipts, grouping expenses and pulling together records 
• Understand the basics by explaining concepts in plain language, like the difference between a deduction and an offset 
• Draft and summarise by turning long documents into clear summaries or helping you prepare questions for a tax agent 
• Spot gaps by prompting you about missing records or deductions you might have overlooked

These are the tasks AI is good at: preparation, not decisions. 

Behind the scenes, AI is also already part of the system. The ATO uses types of AI – including data analytics and machine learning models –to process information, match data and help identify issues for review.  

The same speed and confidence that make AI useful can also cause problems. 

A few simple habits can help you avoid the common risks: 

Protect your personal information

Do not paste your tax file number, myGov login or full financial records into a public AI chatbot. Once shared, that information can be difficult to control. 

Check the source 

Ask where the answer comes from and follow the link provided. Reliable guidance should trace back to the ATO, a registered tax agent or another trusted authority. 

Watch for overseas rules 

If thresholds, dates or terminology look unfamiliar, treat the advice with caution. Generative AI tools are trained on large datasets drawn from across the internet, which can include non-Australian tax rules, outdated legislation or overseas advice. 

Know your limits 

AI can support straightforward returns. For anything more complex, such as business income, investment properties, capital gains or foreign income, speak to a registered tax agent. 

The ATO has specifically warned that AI-generated advice can sound convincing even when it’s wrong, and should always be checked before acting on it.  

You can learn more about using AI for tax and super information from the ATO.

Before you press ‘lodge’, take a minute to sense-check your return: 

1. Did I keep my tax file number and personal details out of AI tools? 
2. Can I trace any claims back to official information from the ATO or a registered tax agent? 
3. Does everything reflect Australian rules? 
4. Have I checked the final figures myself? 
5. For anything complex, have I spoken to a professional? 

If the answer is yes across the board, AI has done its job and you’ve stayed in control. 

AI can take a lot of friction out of tax time. It can help you get organised, understand the basics and arrive better prepared. 

But it’s not a tax agent. 

Use it to support your thinking, not replace it. Check what matters, protect your information, and keep responsibility where it belongs: with you. 

This article is general information about using AI and does not constitute tax or financial advice.