Overview
- The proposals, first published in July 2026 and included in the Finance Bill on Wednesday, November 11, 2026, would let HMRC request and inspect digital records plus the software, automated processes and AI tools that produced tax figures.
- HMRC says requests must have a lawful basis and are intended to reflect modern digital record‑keeping rather than a blanket search of everyone’s chatbot use.
- Campaign groups and tax advisers warn the expanded definition of digital information to cover “any relevant thing” could force third‑party providers to hand over prompt histories, chatbot conversations or commercially sensitive material.
- Taxpayers who ignore information requests already face penalties, starting at £300 with higher fines for unreported inaccuracies, and advisers tell users to verify AI outputs and avoid entering sensitive data into chatbots.
- If the Finance Bill receives Royal Assent the changes would be implemented in 2027 and could reshape investigations by making the technical workings behind calculations a routine part of tax enquiries.