A UK tribunal has ordered HMRC to clarify if AI was used in rejecting R&D tax credit applications. This decision follows a FOI request by tax adviser Tom Elsbury, who suspected AI involvement. Despite initial resistance, the tribunal ruled in favor of transparency, citing public interest. HMRC has until September 18, 2025, to comply.

Elsbury’s concerns also extend to potential use of AI language models like ChatGPT by HMRC, posing risks of sensitive data exposure, including national security-related information. R&D tax relief claims may involve details on advanced weapon systems, making inadvertent disclosure through AI platforms a serious issue. The need for safeguards and transparency is emphasized.

HMRC’s increased scrutiny of R&D tax credits due to fraud has led to concerns about overly stringent evaluations. Some fear valid claims may be rejected, deterring businesses from seeking relief. The tribunal’s directive aims to address these issues by compelling HMRC to disclose the use of AI in R&D claim assessments, ensuring accountability and trust in the system.

Read more at Yahoo Finance: Tribunal directs HMRC to reveal AI use in R&D tax credit rejections