Comparisons

AI-drafted or consultant-drafted R&D claims: strengths, failure modes and the review both need

AI drafting is strongest when the evidence already sits in engineering and payroll systems; consultant drafting is strongest when the work lives in people's heads or paper records. Neither is safe unreviewed. The test is whether every statement of fact rests on records made at the time, with later explanation only interpreting them, checked by someone qualified.

Reviewed by George WalchFacts last verified

AI-drafted and Consultant-drafted side by side

AI-drafted compared with Consultant-drafted
FactAI-draftedConsultant-drafted
Where the draft comes fromRecords the software can read, such as tickets, pull requests, documents and payrollInterviews with technical leads, plus documents they hand over
CoverageThe records the connected tools return for the year, within each connector's limitsWhat people recall and choose to share in the time available
Typical failureFluent text that goes beyond the evidence, or padding to meet field minimumsReconstruction from memory long after the work, with dates and results blurred
Blind spotsWork with no digital trace, and context nobody wrote downDetail buried in thousands of records no one re-read
Judgement on eligibilityCan flag and sort; a qualified person must decideBuilt in, if the consultant has the technical background
Effort from your teamReviewing and correcting a draftInterviews and document requests, usually near year end

Can you use both?

Yes, and the strongest claims usually do. A draft built from records gives the reviewer something concrete to test, and a short conversation with the people who did the work fills the gaps the records leave. What matters is that the final text claims nothing the evidence does not support, whichever method produced the first version.

This page compares two ways of producing the words in a registration. It is not about which firm or product to choose, and it starts with what AI cannot do.

The limits of AI drafting

A language model writes from what it is given. If an experiment, a failed approach or a conclusion never reached a ticket, a pull request or a document, the model cannot know it happened. The bigger danger runs the other way: a model asked to describe a hypothesis will produce a plausible one even when the records do not contain it. That is fabrication, and it is the opposite of what the program requires.

The registration form adds pressure. Every narrative field allows up to 4,000 characters, and six core activity fields have minimums, for example 650 characters for the hypothesis. A tool told to reach a minimum can pad, repeat or inflate the uncertainty. A careful method treats a short field as a sign that evidence is missing, not as a gap to fill with words.

Finally, a tool cannot sign. When applying, the company declares that the information is complete and correct, that it kept appropriate records while doing the work, and that the activities meet the requirements. That declaration is a person's.

The limits of consultant drafting

An interview-led draft is written by someone who can ask why, which is a real strength. Its weakness is timing. Interviews often happen months after the work, and memory fills gaps confidently. The ATO says paperwork prepared afterwards is generally not enough by itself unless some contemporaneous records back it up. A consultant also sees only what people raise in the time booked, so a dead end that taught the team something may go unclaimed, and a routine feature may be described as an experiment because it was memorable.

Four tests for any draft

  1. Supported. Each statement of fact about a hypothesis, test or result rests on records made at the time. Explanation written later can interpret those records and set out the reasoning; it cannot add an experiment or a result the records do not show.
  2. Honest about gaps. Missing evidence is flagged for a person to answer, never filled in.
  3. Not inflated. The uncertainty described is the one the team actually faced, judged against what a competent professional could have known.
  4. Reviewed by someone qualified. Grouping activities, for example, is only proper where they resolve the same technical uncertainty, and that call needs judgement.

The same field, drafted two ways

An illustrative hypothesis field, written from the same records: a ticket and two pull requests showing a per-tenant cache that missed its latency target in two load tests.

  • Beyond the records: "The team hypothesised that a novel distributed caching architecture would cut latency by 80% across all services."
  • Within the records: "The team expected per-tenant caching of ranked results to keep p95 latency under 200 ms at 5,000 requests a second. The first two load tests, recorded in the pull requests, did not."

The second is plainer, and each figure in it can be checked. Neither sentence makes the work eligible: that still depends on whether a competent professional could have known the outcome in advance.

Which method suits which company

AI drafting suits teams whose work already leaves a trail, typically software, data and health technology companies using issue trackers and version control. Read how records support claims for training ML models. Interview drafting suits work that happens at the bench, in the field or on paper, and first claims where nobody yet knows what to record.

Rand uses the first method with review on top: AI drafts the registration from GitHub, Jira, Linear and Notion records and Xero payroll, the team reviews it, and an Expert Reviewer finalises it before the company submits. For the commercial side of the same choice, see R&D tax software vs a consultant.

Frequently asked questions

Is it allowed to use AI to write an R&D Tax Incentive registration?
Nothing in the program forbids a drafting tool. What matters is the declaration: the company states that the application is complete and correct, that it kept appropriate records, and that the activities meet the requirements. A tool does not carry that responsibility; the company does.
Can AI decide whether an activity is eligible?
It can sort records against the criteria and flag likely exclusions, but eligibility turns on facts and judgement, such as whether a competent professional could have known the outcome in advance. That call belongs to people who know the field and the company, which is why review is part of the method.
Will AusIndustry treat an AI-drafted application differently?
Applications are assessed on what they say and the records behind them. In an examination the department normally allows 30 days to provide evidence, so a draft that cannot be traced back to records is a risk whoever or whatever wrote it.
What should a consultant interview capture that software cannot?
Reasoning that was never written down: why an approach was abandoned, what the team knew before starting, and work done away from the keyboard. Good interviews then point to a record that confirms each point rather than standing alone.

Sources

  1. business.gov.au: Record keeping for the R&D Tax Incentive (declarations)
  2. ATO: Helping you get R&D claims right (documents created after the fact)
  3. business.gov.au: Apply for the R&D Tax Incentive (grouping activities)
  4. business.gov.au: Decisions we make about applications (examinations)

The R&D Tax Incentive is a self-assessment program. This page is general information, not tax, legal or financial advice; eligibility depends on your circumstances and you should seek independent advice for them.