Off-the-shelf AI is fast to switch on and impossible to own. Your prompts, your data and your workflow live on someone else’s platform, and the day the price changes or the service closes, so does your capability. A custom build is different: the system, the data pipeline and the workflow are yours — documented, portable, and recognised as an asset. Built right, it can also underpin an R&D Tax Incentive claim.
An AI system your business owns and can defend — portable, documented, and structured so the value (and any R&D claim) lands in the entity that should hold it.
Where this maps in the law & standards
R&D Tax Incentive under Division 355 ITAA 1997 (jointly administered by AusIndustry and the ATO) for eligible development; AASB 138 Intangible Assets for recognising and measuring the system you own.
This page is general information only — not personal financial, tax or legal advice. Any AI build or advisory work is performed under a signed engagement with Local Knowledge Pty Ltd, in accordance with the applicable professional standards, and every material output is reviewed by a CPA. Building an AI system reduces risk to a reasonable level; it is never a guarantee of a particular outcome.
Everyone is “doing AI”. The real question is which decisions in your business it should actually make — and which it never should.
A model that made sense last quarter can drift, leak data or make a call it never should. Who is watching it — and against what standard?
Your AI system and the data behind it can earn — but only if you own them, and the income lands in the right entity.