Most bookkeeping messages can be drafted with no client details in them at all. That's the simplest protection, and it's worth trying first.
When you do want to include something real, a few checks come first. This page covers what official bodies say in Australia and the UK. It doesn't cover US rules or state laws, so US readers should go to the Federal Trade Commission and their state regulator.
None of this is legal advice. Nothing here says that any practice or tool meets a rule.
Where your words go
Typing into a chat window feels private. It isn't a closed envelope. The text goes to the company that runs the tool. What happens next depends on its terms, your plan and your settings.
The Australian privacy regulator tells businesses to find out who gets access to personal information that goes into a product or comes out of it.1 Only the maker's own privacy and data pages for your plan can answer that.
What the regulators say
Australia. The Office of the Australian Information Commissioner says Australian privacy obligations cover any personal information typed into an AI product.1 As a precaution, it suggests leaving personal information out of open, publicly available generative tools, especially the sensitive kind.1
The same page links to a separate rule on protecting tax file number information.1 If you handle those numbers, read it directly.
Sending data outside Australia raises a further question. When it's a disclosure, the regulator expects reasonable steps to make sure the overseas recipient follows the Australian Privacy Principles.2 Some AI tools may hold data abroad. Read the maker's page on where it's stored.
United Kingdom. GOV.UK lays out data protection duties for firms holding personal information.3 It wants that information secure, accurate and current.3 The Information Commissioner's Office is where to take questions.
Risk frameworks. The US National Institute of Standards and Technology publishes a framework meant to help manage risks to individuals, organisations and society from AI. It's intended for voluntary use.4 It's worth a look if you write practice policies.
Questions to ask before you paste
| Question | Why it matters | Where to look |
|---|---|---|
| Can I use a placeholder? | No real data, no risk from it | Your own prompt |
| Who can read what I type? | It depends on the maker's terms and your plan | The maker's privacy and data pages |
| Is it used for training? | Terms can differ by plan and setting | The maker's settings and terms |
| Where is it stored? | Overseas rules may apply | The maker's data pages, the regulator |
| Did my client expect this use? | Your privacy notice may need to say so | Your regulator's guidance |
The table asks the questions. Only the maker's current pages can answer the middle ones, and they change, so check them again from time to time.
What to take out
Strip these before using any general tool:
- Full names, addresses, phone numbers and email addresses
- Bank account and card numbers
- Tax file numbers, national insurance numbers, social security numbers and similar IDs
- Passwords or login codes of any kind
- Anything about a client's health, family or personal circumstances
Replace each with a label: "[Client]", "[Account]", "[Amount]". Put the real values back in your email programme, not in the chat.
Check the draft too
What comes back can hold personal information too. The Australian regulator says the duties cover output as well, where it contains such details.1 Read the draft and delete anything you didn't give the tool. Don't keep chat history longer than you need.
Writing it down
With staff, write a short note on what may go into AI tools. Add how drafts are checked before sending. Your regulator's pages show what it should cover. The starter templates page shows prompts built around placeholders.
Unsure about a case? Ask your country's regulator or a qualified adviser. Don't ask the chatbot.
Sources used
- Guidance on privacy and the use of commercially available AI products, Office of the Australian Information Commissioner (OAIC)
- Sending personal information overseas, Office of the Australian Information Commissioner (OAIC)
- Data protection and your business: Overview, GOV.UK
- AI Risk Management Framework, National Institute of Standards and Technology (NIST)
More from the desk
What AI Can and Cannot Do for a Bookkeeper's Client AdminWhere an AI writing tool helps with the messages and paperwork around bookkeeping, and where it should stay out, explained from how it works inside.
Chasing Missing Receipts and Documents with AI-Drafted MessagesHow to ask for late receipts, statements and files in a polite, clear message, with an AI tool doing the wording and you supplying every fact.
Writing Client Onboarding Emails and Checklists with AIWhat to send a new bookkeeping client, and how an AI tool can help you draft a welcome message and a what-we-need list that you then check yourself.