How to prepare for AI in your corporate tax department
Highlights:
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The buzz around artificial intelligence (AI) isn’t just hype anymore, especially within the corporate tax world. 94% tax professionals are optimistic about the potential of new technology. AI will be a central part of their work in the next five years, according to 88% of tax professionals. The change has already begun. The latest Thomson-Reuters Corporate Tax Department Technology report reveals that 42% are actively exploring AI solutions. This is not a trend of the future; it is happening now. Driven by the promise of increased efficiency, increased accuracy and the freeing up of valuable human resources for strategic work, this technological evolution prompted a discussion in a Thomson Reuters webinar entitled “The Time Is Now: Preparing The Corporate Tax Department for AI.”. It was moderated by Tracy Davis Global Director – Retail & Manufacturing Industry Leader. The webinaralso featured insights from AI strategists Andrew Fletcher, David von Rickenbach and Product Marketing expertRoshen Ibrahim. They addressed pressing questions for tax leaders including: How does AI reshape the landscape? What are the real challenges and opportunities? How can you prepare yourself and your team for the future? This summary captures key takeaways, but the full depth of strategy is available in the complete session.
The AI wave is here: Embracing augmentation over replacement One of the most significant reassurances emerging from the discussion is that AI in tax is primarily about augmentation, not wholesale replacement. AI is designed to enhance tax professionals’ capabilities. Automation handles repetitive tasks. According to Andrew Fletcher, “Automation can sometimes be scary because that’s replacing things that have been done manually… but for us… it’s the augmentation that’s exciting and where there is the biggest opportunity.”
Think of AI as a powerful assistant. The report shows that 74% respondents prioritize process automation — AI can supercharge it. It can sift though vast datasets, identify anomalies and handle preliminary analysis. It can also streamline compliance tasks much faster than manual methods. This allows tax professionals to focus on other important tasks, such as strategic thinking, complex advice and risk assessment, or relationship management. Tracy Davis called AI a “digital resource junior” that addresses a critical need within the profession. It’s time to get started: cultivating trust and an experimentation mindset Knowing AI can be beneficial is one thing, but successfully integrating it is quite another. The panelists stressed that adoption is not a rigid and linear process. David von Rickenbach, focusing on AI in corporate tax and trade at TR Labs, stressed, “We aim to reach our goal, but the journey won’t follow a straightforward path like steps 1, 2, 3, and 4.” This journey requires two crucial elements: trust and a willingness to experiment.
Andrew Fletcher highlighted the importance of trust:“Trust is crucial… trust in the tools that you give to your people, and trust that they know their jobs… and they’ve built familiarity with those tools.”
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This involves selecting reliable AI solutions and empowering teams to use them effectively. This familiarity is often built slowly. Von Rickenbach suggested focusing on “low hanging fruits” – practical and achievable use cases that could be achieved using tools already available. “It is about trying it out with the tools you have, creating some hypotheses and learning from them,” said Rickenbach. He urged people to not adopt AI just for its sake, but instead to identify real pain points that it can solve, such as data classifying or anomaly detection. Fletcher stressed the importance of embedding AI within existing systems. “If you think about it, the best technology or the easiest technology is the one you already have.”–
Early and iterative learning are key. Abraham said, “Early detection is the key to early prevention.” This emphasizes how proactive adoption can minimize risks and maximize benefits faster. Consider AI integration as an ongoing learning process, rather than a single implementation project. Navigating the hurdles, ensuring ethical and compliant AI Integration
While AI’s potential is enormous, it is not without challenges. In a highly regulated tax environment, the ethical and compliance use of AI is crucial. Andrew Fletcher warned, “When we consider ethical and compliant AI, it is thinking about what AI does here, what is suitable, and whether I would want to handle and treat data in this manner.”–Data protection and privacy are major concerns. Tax departments deal with highly sensitive corporate and individual information. Von Rickenbach emphasized the need for transparency in data usage, and robust safeguards that prevent exposure. |
Furthermore AI models are trained from data. If that data contains biases then the AI’s output could perpetuate or even amplify them. This requires critical human oversight. Fletcher said that professionals need to be able to evaluate the outputs to ensure accuracy, fairness and compliance. It’s not only recommended, but essential to adopting AI responsibly.
The current wave in AI, characterized by Large Language Models, is already transformative but its evolution is not over. Andrew Fletcher highlighted “reasoning systems” and “agenttic systems”, which have the potential to be more sophisticated than pattern recognition. While they are currently excelling at constrained domains such as math and coding their sophistication is rapidly increasing. This means that in the future, they will be able to handle more complex tax scenarios. Fletcher acknowledged previous AI hype cycles, but said, “this time, the pace of change is different and the evolution of abilities are genuinely new.”–
Another trend noted by Von Rickenbach was the move to smaller, proprietary AI model. He explained that the barrier to hosting and training a proprietary language model was lowering. This allows companies to create AI that’s trained on their data and processes. This allows them to create very specific solutions, and could give them greater control over data security and privacy. Don’t be left behind! Prepare for the AI-driven future now. The experts’ insights paint a clear picture of how AI is becoming increasingly important to corporate tax. It offers unprecedented opportunities for efficiency, accuracy, and strategic focus, but requires thoughtful planning, an experimental approach, and a strong focus on ethical implementation.
Understanding how to navigate this shift, upskill your team, choose the right tools, and implement AI responsibly is critical for future success. The full webinar
“The Time is Now – Preparing the Corporate Tax Department For AI” contains the in-depth strategy and practical recommendations that you need. Prepare the corporate tax department to AI
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