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How can the new HMRC £7.4m AI upskilling fund help accountants?

05 Apr 2024

In a rapidly advancing technological landscape, how can the accounting profession stay ahead? HMRC have announced a new grant fund to help with just that!

In the Spring Budget earlier this year, UK government set forth a plan to offer a £7.4 million AI funding initiative aimed at accountants.

The new scheme, administered by the Department of Science, Innovation and Technology (DSIT), will see small and medium-sized enterprises (SMEs) in the accountancy field, along with other sectors, encouraged to integrate artificial intelligence (AI) into their practices.

If you are an accountant in practice or industry and would like more information about becoming a 20:20 Innovation member, why not book a free 30-minute demo with our team today.

Why is AI adoption crucial for accountancy?

The potential for AI to transform the accountancy sector is vast. From enhancing the efficiency and accuracy of routine tasks to providing deep insights into financial data. AI technologies promise to significantly boost the value accountancy firms can deliver to their clients.

Artificial intelligence is already making waves in existing accounting software and specific AI accounting software has hit the market over the past 12 months. However, the broader uptake of AI within smaller accountancy practices has been impeded by a notable skills gap in the understanding and use of it.

Accountant using AI to improve accuracy

How are AI tools being used in accounting?

AI technology such as large language models has been seen to improve speed on repetitive tasks, for example using natural language processing to help write emails to clients, marketing or standard letters to HMRC.

Some of the most popular accounting software on the market has noticed the need for further developments. These include real-time insights into the accounting industry to help accountants support their clients.

Software such as Sage, Quickbooks, and Xero have announced they will be embedding AI tools such as chatbots to provide expert advice powered by machine learning algorithms to users.

Organisation using chatbot to integrate machine learning

Why are accountants best placed to use artificial intelligence?

With the vast amount of data accountants have access to, they have valuable insights that enable them to support businesses.

Accounting as a profession has already seen huge changes. In the UK, organisations record and access their financial data using tools that were unimaginable years ago, and advice given by professional services has changed as a result.

Despite some businesses not initially understanding the many benefits of cloud technology and seeing a new cost associated to bookkeeping (especially for MTD compliance), many have now realised, the improved accuracy, reduction in risk, easy ability to cash flow forecast and general transparency into their money is a huge advantage organisations now can't life without.

Accountants have been able to assist HMRC is their project of digitising the finance system and communicating the importance to their clients. Throughout the past decade, accountants have shown extra resilience while still offering standard compliance work and advice in an ever-changing landscape for business.

Therefore this grant has come at a crucial time to enable development.

Accountant looking to manage workload with artificial intelligence

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What does the flexible AI upskilling fund offer?

In a bid to support businesses in their journey to adopting artificial intelligence, the Flexible AI Upskilling Fund aims to directly bridge the AI skills gap with grant funding.

The fund encourages SMEs in the accountancy, bookkeeping, and auditing fields to advance their employees' understanding of AI by offering to cover up to 50% of the costs associated with AI training.

This initiative not only promotes the adoption of AI technologies but also helps future-proof small businesses against the rapidly evolving digital economy.

Who can benefit from this initiative?

Eligibility for the scheme is designed with SMEs in mind.

To meet the criteria for the AI support the following must apply:

  • Operate within the professional and business services sector.
  • Be registered in the UK.
  • Employ between one and 249 staff.
  • Have been operational for at least a year.

A critical condition is that firms must be able to provide 50% of the training costs themselves, creating shared investment in the technological advancement of their workforce.

Small business in Northern Ireland getting AI funding support

How can your firm participate?

Firms interested in taking advantage of the grant funding are encouraged to express their interest through the government's Find a Grant service.

Formal applications are set to open on 1 May with the application window closing on 31 May, with a pre-launch Q&A webinar scheduled for 16 April. This session offers an opportunity for firms to gain further insights, obtain more guidance and clarify any questions regarding the fund with HMRC expected to explain exactly how to access the funding and track your application.

Due to a rise in UK small businesses, especially in finance, being on a journey of digital transformation including ai, there is expected to be an overwhelming demand for the money available and therefore successful applicants for the funds are expected to be chosen through a lottery system.

Do the available funds have an expiry date?

Selected firms small businesses will have until 31 March 2025 to complete the requisite training in AI and claim their reimbursement, providing a generous timeframe to implement the upskilling initiative.

Can 2020 Innovation help with AI?

This funding initiative represents more than just financial support—it's a catalyst for transformation within the accountancy profession and small businesses who want to take full advantage of using AI tools.

By investing in AI skills, firms not only enhance their operational capabilities but also affirm their commitment to innovation and excellence.
Embracing artificial intelligence is not merely about adapting to the future; it's about actively shaping it.

Through the Flexible AI Upskilling Fund, accountancy firms have a unique opportunity to lead in the AI revolution, setting new benchmarks for professional achievement and client service.

20:20 Innovation work with more than 1,200 accountancy businesses in the UK and we provide a niche technology forum, Tech-Talk, to help accountants with efficient and informed decisions around technology.

If you would like more information about joining 20:20 Innovation why not book a free 30-minute demo with our team today or call us on +44 (0) 121 314 2020.

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