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  • Self-education expenses

    You can claim a deduction for self-education and study expenses if the education relates to your employment activities.

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    Eligibility to claim

    You can claim a deduction for self-education and study, if you receive a taxable bonded scholarship or you incur expenses when the self-education or study has a sufficient connection to your current employment activities as an employee. The self-education or study must either:

    • maintain or improve the specific skills or knowledge you need to perform your current employment activities
    • result in or is likely to result in, an increase in your income from your current employment activities.

    You generally can't claim the first $250 of expenses for your self-education. Check when you must include a $250 reduction in expenses before you can claim.

    You can't claim a deduction for self-education and study expenses that:

    • doesn't have a sufficient connection to your current work activities
    • you incur when you are not employed
    • only relates in a general way to your current employment – such as undertaking a full-time fashion photography course and working as a casual sales assistant on the weekends
    • enables you to get new employment or change employment – such as moving from employment as a nurse to employment as a doctor.

    Example: employment ceases while studying

    Callum is an employee software developer. To improve his skills as a software developer Callum commences a Graduate Diploma in Advanced Software and Network Technology. The course takes 1 year and is paid for in 2 instalments, which become due as each semester commences. Callum’s employer is supportive of his study and offers paid leave for Callum to study each week.

    During semester 1 Callum is made redundant. He chooses to continue studying the course while unemployed.

    Callum can claim a deduction for the semester 1 payment as he was working and earning income when he made that payment. Callum can’t claim a deduction for the semester 2 payment.

    As Callum was unemployed at the time he made the semester 2 payment, it was not incurred in earning his income.

    End of example

    Taxable bonded scholarship recipients

    You can claim a deduction for self-education expenses if, in doing the course, you are satisfying study requirements to maintain your right to a taxable bonded scholarship.

    If you're an employee of the scholarship provider, normal work-related self-education rules apply.

    Expenses you can claim

    If your self-education and study expenses meet the eligibility criteria, you can claim a deduction for following expenses:

    General course expenses

    You can claim a deduction for the following general course expenses you incur:

    • accommodation and meals (if away from home overnight and not living at a location)
    • car expenses
    • computer consumables – for example, printer cartridges
    • course and tuition fees
    • decline in value for depreciating assets (costing more than $300)
    • equipment or technical instruments (costing $300 or less)
    • equipment repairs
    • fares
    • fees payable on some study and training support loans (that is, FEE-HELP and VET Student Loan), but not repayments on the loan itself
    • home office additional running costs
    • interest
    • internet and data usage (excluding connection fees)
    • parking fees (only for work-related claims)
    • phone calls
    • postage
    • stationery
    • student union fees
    • student services and amenities fees
    • textbooks
    • trade, professional, or academic journals
    • travel expenses, including car expenses  
      • between home and your place of education
      • between your workplace and the place of education.

    For work-related self-education, you can't claim the cost of the last stage of your travel from:

    • home to your place of education, and then to work
    • work to your place of education, and then to your home.

    However, you may be able to offset the cost of last stage of your travel against the $250 reduction in expenses.

    See claiming specific self-education expenses for more detail on claiming education expenses.

    Depreciating assets

    You may be able to claim a deduction for assets that lose their value over time such as computers and printers.

    You can claim:

    • the decline in value of an asset that cost more than $300 to the extent you used the asset for your self-education and not private purposes
    • the full cost of an asset that cost $300 or less (in the income year you buy it) if you mainly used the asset for your self-education.

    Car expenses

    If your self-education and study expenses have sufficient connection to your current employment, you can claim daily travel expenses from your:

    • home to your place of education and back
    • work to your place of education and back.

    However, you can't claim the cost of the last stage of your travel. For example:

    • home to your place of education, and then to work
    • work to your place of education, and then to your home.

    Expenses you can't claim

    You can't claim the following expenses in relation to your self-education and study expenses:

    • tuition fees paid by someone else or that your employer or a third-party reimburses you for
    • student contribution amounts
    • repayments of study and training support loans such as  
      • Higher Education Loan Program (HELP) (such as HECS-HELP, FEE-HELP and OS-HELP)
      • Student Financial Supplement Scheme (SFSS)
      • VET Student Loans (VSL)
      • Student Start-up Loans (SSL)
      • ABSTUDY Student Start-up Loans (ABSTUDY SSL)
      • Trade Support Loans (TSL)
    • working from home occupancy expenses – for example, rent, mortgage interest or rates
    • accommodation and meals (unless sleeping away from home for study, such as to attend a residential school).

    From the 2011–12 income year onwards, you can’t claim a deduction for self-education and study expenses you incur if you only receive a qualifying Australian Government allowance or payment. This allowance or payment is a rebatable benefit and is eligible for the beneficiary tax offset.

    Example: receiving Austudy payments

    Alison starts a full time Bachelor of Pharmacy. As she has two young children, she applies for and receives Austudy payments from Centrelink rather than finding employment to support herself while studying.

    Austudy is a taxable government assistance payment and is eligible for the beneficiary tax offset.

    Alison can't claim a deduction for her self-education expenses because she receives Austudy payments and Austudy is a rebatable benefit.

    End of example

    For more detail about the deductibility of self-education expenses, see TR 98/9Income tax: deductibility of self-education expenses incurred by an employee or a person in business

    $250 reduction in expenses

    There are 5 categories that we place self-education or study expenses in to. If all of your self-education or study expenses are from 'category A' then you have to reduce your total claim for self-education and study by $250.

    However, if you have expenses which are not allowable as a deduction from 'category E', you can use these expenses to offset the $250 reduction.

    Expenses offset against the $250 reduction

    While you can't claim a deduction for the following expenses, you can use them to offset the $250 reduction. These expenses include:

    • childcare while attending self-education activities
    • capital expenses related to your self-education such as, the purchase of a desk
    • fares, travel or car expenses for these journeys      
      • for work-related self-education, the second leg of a trip if you went from home to your place of education and then to work, or the other way around
      • if you receive a taxable bonded scholarship and are not an employee of the scholarship provider, travel from home to your normal place of education and back.

    Apportioning expenses

    You need to apportion some expenses between private purposes and use for self-education and study.

    If you use equipment such as computers and printers privately and for self-education or study, you must apportion the expenses. You base your claim on the percentage you use the equipment for your work-related self-education and study. For example, if you use a computer 50% of the time for self-education and study and 50% for private purposes, you can only claim half the decline in value of the computer for that income year.

    You may be able to claim the cost of particular subjects of a qualification or components of a course where those subjects or components have a sufficient connection to your current employment activities.

    Example: course overall isn’t connected to current employment

    James is an employee civil engineer. His duties include designing water and sewerage systems, determining the materials to be used for the systems, carrying out environmental impact studies, and project management of the projects he works on.

    After 10 years in a workplace, James decides to enrol in a Master of Business Administration (MBA) at a university to broaden his career opportunities, including possibly opening his own firm in the future. The cost of each subject is identified in documents he receives from the university.

    Not every subject in the MBA has a sufficient connection with James’ current employment activities, and so James can't claim a deduction for the total course fees. However, if James studies a subject on project management as part of his MBA qualification, that particular subject would have a sufficient connection to his current employment activity of managing projects. James would be able to claim the cost of the project management subject.

    End of example

    Calculate your self-education deduction

    Use our Self-education expenses calculator to work out your eligibility and get an estimate of your self-education and study deductions.

    Keeping records for self-education expenses

    You must keep receipts for all self-education and study expenses you incur, for example:

    • course fees
    • text books
    • stationery
    • depreciating assets such as computers, laptops and office equipment
    • transport and travel expenses.

    You also need to be able to explain how the self-education and study directly relates to your employment at the time you incur the expense.

    If you are claiming a deduction for a depreciating asset that you have used for self-education or study, you must keep:

    • your receipts
    • a depreciation schedule
    • details of how you work out your claim for decline in value
    • details of the percentage of time you use them for self-education or study.

    Use the myDeductions tool in the ATO app to keep records of your expenses and income in one place, including photos of your receipts and invoices.

    Last modified: 01 Aug 2022QC 31970