AI in the tax firm: confidential client data, clear rules

Which rules apply to tax advisors using AI?

• § 203 StGB: Tax advisors and auditors are among the professionals bound by secrecy. The unauthorised disclosure of client information — including to an AI service that stores it — is a criminal offence. Engaging service providers has been permitted since 2017 where it is necessary and the provider is bound to confidentiality — anchored for tax advisors in § 62a StBerG (for auditors: § 50a WPO).
• GDPR: Financial data is personal data with a considerable need for protection. Required are a data processing agreement (Art. 28), security of processing (Art. 32) and, with US providers, an answer to the third-country problem (Art. 44 et seq., Schrems II). Fines under Art. 83 GDPR reach up to €20 million or 4% of turnover.
• Practical confidentiality: Annual accounts, salaries and clients' operating figures are trade secrets. A provider that stores inputs or uses them for training creates a body of data that becomes a client's loss in the event of an incident.

Why are public chatbots the wrong tool for tax firms?

The free and consumer versions of the major chatbots store conversations and — depending on the setting — use them for training; processing takes place predominantly in the USA, where the CLOUD Act permits authority access even to EU-stored data held by US providers. Anyone who has a client's annual accounts "quickly summarised" has thereby disclosed them to a third party that is neither bound to confidentiality nor guarantees deletion. The problem is not the AI — it is the data path.

Where does AI actually pay off in a tax firm?

1. Client communication: cover letters, reminders about missing documents, explanations of tax assessments in plain language — the biggest time sink in day-to-day practice becomes a draft at the push of a button.
2. Summaries: condensing circulars from the Federal Ministry of Finance, legislative changes and long audit reports down to the points that matter for the client.
3. Structured drafts: grounds for appeals, statements, internal memos as a first version — the professional assessment stays with the qualified advisor.
4. Team knowledge work: onboarding materials, checklists for recurring processes (deadlines, year-end preparation), client FAQs.
5. Translations for international engagements — without the figures ever leaving the building.

One thing remains essential: tax assessments are reviewed by a human. AI supplies drafts and structure, not legal advice — and figures in AI answers must always be checked against the source.

How PrivatAI meets the requirements

PrivatAI stores nothing: inputs and responses are processed and discarded — not logged, never used for training. The application runs in Germany (Hetzner), the AI processing in France (Scaleway): client data stays in the EU and the CLOUD Act does not apply. Contractually secured through the data processing agreement under Art. 28 GDPR with a professional-secrecy clause (§ 203 StGB, § 62a StBerG) and, on request, a separate undertaking on professional secrecy including the instruction required by § 203 (4) StGB. The OpenAI-compatible API connects PrivatAI to practice management software and internal tools; the chat covers everyday work.

Which plan covers what. Essential and Professional include the EU processing described above and the Art. 28 GDPR data processing agreement with its professional-secrecy clause — that clause binds PrivatAI. What the standard plans do not include is the § 203 obligation passed down across the entire sub-processor chain, AI inference in Germany, and assurances for seizure situations (§ 97 StPO). Those are part of the Enterprise setup only and are agreed separately. If your own risk assessment requires the whole chain to be bound, that is an Enterprise conversation rather than something the €30 or €60 plan settles.

PrivatAI supplies the technical and contractual prerequisites for a compliant setup. Whether a particular use is permissible under professional law in your specific case is a question for your Steuerberaterkammer or your own adviser — no provider can certify that on your behalf.

PrivatAI (privatai.com) — AI chat & API from Germany. No content logs, no training on your data, GDPR-compliant.

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