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The Tax Institute has warned accountants against entering confidential client information into AI tools such as ChatGPT.
Tax practitioners warned against entering confidential info into ChatGPT
24 June 2025
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7 minute read
Speaking last Friday at the ACE25 Accounting Conference & Expo, hosted by Accountants Daily, Tax Institute chief executive Scott Treatt reminded practitioners that entering confidential client information into AI tools such as ChatGPT would count as a breach of privacy under their code obligations.
“I hear stories of people like loading client information into AI or ChatGPT, if that's client information, that's confidential, that's going into the World Wide Web, that is a breach of confidentiality,” Treatt said.
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“We've got to be really careful of some of these things, right? Where is that information being stored? What is that agreement that you've actually got with the client, going back to those engagement letters?”
In the aftermath of the PwC tax leaks scandal, tax practitioners have been subject to new breach reporting rules and tighter code obligations. One such obligation relates to client confidentiality.
In 2022, it came to light that PwC’s international tax chief had breached confidentiality by sharing sensitive government client information on upcoming multinational tax laws, tipping off multinational clients to the new laws.
Under the code of conduct, a tax practitioner must not disclose confidential client information to a third party without their client’s permission, unless they have a legal duty to do so.
The breach reporting rules place new obligations on tax agents to alert the Tax Practitioners Board if they suspect that they – or another tax agent – has breached their code obligations, including confidentiality provisions.
At last Friday’s event, Treatt reminded practitioners of their obligations to safeguard confidential client information – a task which could be complicated by the uptake of new digital technologies.
As AI usage becomes more ubiquitous across the accounting profession, his warning comes as a timely reminder that new tools must be integrated with careful consideration for their privacy and cyber security risks.
Treatt added that practitioners should also be mindful of privacy concerns when handling client information in other online formats, including email and within cloud-based technologies.
“Seeing tax file numbers still going through in an email correspondence... What are you doing [to protect] confidential information?" he asked.
Aside from digital privacy risks, Treatt added that tax agents must refrain from disclosing confidential client information whilst seeking guidance from other practitioners on client matters.
He reminded tax agents that they could only share client information after they had first obtained their client’s permission, or if they had a legal duty to do so.
“I’ve had discussions with members [where I’ve had to say] you can’t share that level of information with me. That is confidential,” Treatt said.
“Be conscious of what you’re sharing.”
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