With the tax return deadline looming at the close of this month, the Australian Taxation Office (ATO) has issued caution for the growing number of Australians using artificial intelligence (AI) to prepare their yearly returns.
Financial comparison site Compare Club surveyed 1,000 Australians and found nearly a third were using AI tools to complete their tax returns, with nearly 40 per cent using the technology to manage their personal finances.
It found some 36 per cent of respondents were open to using AI for finances, while a quarter said they wouldn't trust it.
And more than half of the survey's participants reported using AI most for budgeting, with saving or investing next at 45 per cent and tax preparation at 31 per cent.
ATO assistant commissioner Robert Thomson said the office was "aware" that people were using AI to complete tax returns and receive tax advice.
"We would just issue some caution if people are using AI to help get tax advice because there can be risks associated with it, and we know some of the AI platforms are giving incorrect advice," he told SBS News.
"AI can sound really confident in its answer even when it's wrong, and AI content is only as good as the platforms or content it's taking from."
Thomson said that tax laws could be complex, and differed across countries, so there was an increased risk that the information AI is pulling for you may be incorrect.
He urged anyone using AI to prepare their tax returns to check its sources by clicking on the link to the page that the AI is referencing, and to look for credible advice like on the ATO, or from a tax agent or super professional.
"Whether you're using AI or not, you are responsible for the information that goes into your tax return," Thomson said.
"You're still responsible for the information that goes in."
Privacy risks when using AI to prepare tax returns
Thomson warned of serious privacy concerns, not only when using tools like AI chatbots, but also for when you may receive a phone call or email from somebody who says they are from the ATO.
"If you're going to give up any of your private information, like your myGov information or tax file number, what we'd say is you need to to stop, think and protect," he said.
"Think about whether you trust the person you're giving information to and whether they can keep it safe.
"Think about whether this could be a scam, and whether that person really needs your information.
"If something doesn't feel right, get in contact with the ATO straight away — especially if you've given up your information. Not just your tax file number, this can include things like your date of birth, your account details and your current address. Scammers will put all of that information together like a puzzle to steal your identity."
Thomson said the ATO's focus was on reminding people that if they are using AI for tax advice, they need to be aware of the associated risks, and always check the information with a credible source.
"We know that people are probably using AI to maximise their claims around tax time, but we already have more than 40 industry-specific guidelines on our website that explain what you can and can't claim specific to your job, so that's a really good resource for people," he said.
Compare Club's research shows Australians still prefer expert, human advice.
While two-thirds of people surveyed were using AI more than they were a year ago, financial advisers and government sources were still the most trusted sources for financial advice, scoring 59 and 44 per cent respectively, while AI scored just 25 per cent.
Head of research at Compare Club, Kate Browne, said AI was a great foundation to build on existing knowledge, but it was "important to always double check" your information.
"We know that people still get information from their family and friends and they're actually more likely to get it wrong, but our recommendation for anything like this is to use it as one of your tools," she said.
Browne said it was "very easy to see AI's appeal".
"AI is free or low-cost, a time saver, available 24-7, so it's very easy to see the appeal."
But, she said, the best thing about AI was that it made contemporary, complex information and language accessible.
"One of the reasons people told us they are using AI to get money advice is to break down complex terms, so I think in that sense, it's quite positive. One of the biggest barriers with big financial decisions is that people don't understand, and AI absolutely removes that hurdle," she said.
This article is general information. Please see a professional if you need financial advice.
