Case C76

Judges:
FE Dubout Ch
G Thompson M
N Dempsey M

Court:
No. 3 Board of Review

Judgment date: 19 November 1971.

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F.E. Dubout (Chairman): In his return of income of the year ended 30 June 1970, the taxpayer claimed a deduction for an amount of $95, being the cost of lessons in ballet for two of his daughters. The disallowance of this claim by the Commissioner has lead to the present reference.

2. The two girls, then about nine and seven years of age, attended a State primary school, at which there was no provision for the teaching of ballet. They received their instruction in ballet from a private teacher, in a studio specially built at her home, at times which were outside the hours of attendance at the primary school.

3. The claim falls for consideration under sec.82J of the Assessment Act. At the outset, I must say that, in my opinion, tuition in ballet is clearly an educational process. If the section granted a deduction simply for expenses incurred in connection with the education of a student, the taxpayer's claim could not be resisted. However, the deduction under sec.82J is granted only upon the fulfilment of certain fairly restrictive conditions. In subsec.(6) of sec.82J, the expression ``education expenses'' is defined as meaning ``expenses necessarily incurred by the taxpayer for or in connection with full-time education at a school, college or university or from a tutor''. Since lessons in ballet were not part of the school curriculum, the payments cannot be said to be ``for'' the full-time education at the school. The only question then is whether they can be said to have been ``necessarily incurred...in connection with'' that full-time education.

4. In
13 T.B.R.D. Case No. N.1., this Board, as then constituted, had to deal with a claim for deduction in respect of lessons in ballet, the circumstances of the claim being not materially different from those in the present reference. In a joint decision, the Chairman and Members found as facts that the ballet lessons were not taken at the primary school; they did not form part of the curriculum of the State school at which the taxpayer's daughter was receiving her full-time education; nor was ballet a subject in which she was being instructed in respect of any examination having relation to her full-time education at that school.

5. Upon the basis of those facts, the Board's conclusion was as follows -

``In our view, it is necessary for the taxpayer to establish a substantial relation, in the practical sense, between the expenditure at the ballet academy and the full-time education of the child at the State school (cf.
Berry v. F.C. of T. (1953) 89 C.L.R. 653 ; 10 A.T.D. 262 ). In the above circumstances, we are of the opinion that the necessary nexus has not been sufficiently established, and the objection is disallowed.''

6. In the view that I take as to the interpretation of this section. I consider, with respect, that the Board's decision in Case N.1 was a correct one. On virtually identical facts I must reject the taxpayer's claim in the present reference for the reason that the subject expenditure was not ``necessarily incurred... in connection with '' the full-time education of the daughters at the primary school. I wish to add only two brief comments. First, I would not regard the absence of examination in a subject of study as a relevant consideration in determining whether expenses incurred for fees in that subject qualify for deduction Second, although I consider that the Commissioner has correctly disallowed the claim in this case, I am by no means convinced that the reasoning by which his representative sought to distinguish ballet from other extra-curricular activities is sound Rather it would suggest to me that some claims which the Commissioner allows may not qualify for deduction, under the literal meaning of the section. But in the very nature of things, those are not matters upon which a Board is ever likely to have to pronounce.

7. As I have already stated, I would disallow the taxpayer's objection and confirm the Commissioner's assessment.