QuickBooks launches AI tool for income tax digital compliance

Intuit QuickBooks has introduced a new AI-powered solution for almost two million self-assessment tax filers in the UK, targeting those with income from multiple sources in preparation for Making Tax Digital for Income Tax.

The rollout coincides with upcoming HMRC requirements, which mandate around 2.8 million individuals to keep digital records and submit quarterly updates for self-assessed income tax. This change is considered the most significant in a generation for the UK tax system.

An estimated 1.88 million filers, such as landlords with joint property ownership or those who earn from several streams, are affected. They face the need for separate submissions and multiple software licences, which results in increased administrative demands.

Intuit's new functionality aims to ease these complications by providing simplified self-assessment and MTD compliance via a single platform. The software, which is compatible across all QuickBooks plans, combines automated processes designed to eliminate many routine tasks and reduce reliance on various tools.

The company has invested GBP £3 billion in research and development to underpin advancements such as clear filing processes, automated categorisation, and streamlined reconciliation tasks, accessible through enterprise-grade AI features.

This development also helps accountants to digitise their clients' records, offering AI-driven onboarding and record-keeping tools to speed up preparation for Making Digital Tax requirements for individuals not already using software.

Nick Williams, International Product Director at Intuit, commented, "Many individuals have side hustles, whether from investments, gig work, or property. This can make their tax affairs trickier. We're simplifying this sort of everyday admin by creating done-for-you experiences on our platform. This means that requirements like Making Tax Digital can be achieved with ease by our customers. From starting up, to scaling up and beyond, Intuit puts everything in one place to run and grow a business. With a £3bn investment in R&D, this is something that other accountancy software providers simply can't match."

The solution is intended to deliver what Intuit describes as democratised access to sophisticated AI tools. According to the company, these tools can assist with the delivery, tracking, and management of transactions, resolve activities such as dynamic auto-categorisation, and handle complex bank reconciliations.

Intuit reports that it has collaborated closely with HMRC in defining the requirements for software compliance, participating in early testing stages. The company was the first provider to successfully submit a quarterly update for income tax and partnered with accountants to facilitate the submission of the first final declaration under the new regime.

QuickBooks customers are already using Intuit's solution to actively file under Making Tax Digital for Income Tax requirements, ahead of the full rollout to all eligible taxpayers.