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Edited version of private ruling

Authorisation Number: 1011627129645

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Ruling

Subject: Self education expenses

Question

Are you entitled to a deduction for self education expenses?

Answer

Yes.

This ruling applies for the following periods:

Year ended 30 June 2010

Year ending 30 June 2011

Year ending 30 June 2012

Year ending 30 June 2013

Year ending 30 June 2014

Year ending 30 June 2015

The scheme commenced on:

1 July 2009

Relevant facts and circumstances

You are employed on a full time basis.

In your current role you assess clients with disabilities in their home environments and you make recommendations regarding environmental changes and modifications to their home.

You have enrolled in a part time diploma course and you attend classes three nights a week.

To achieve the diploma, you must complete core units and elective subjects.

You have supplied a list of the elective subjects, and have highlighted the units from which you will choose your electives. These units will relate to your current employment duties.

Your course will assist you in your current duties in the following area:

The course will aid your professional development by improving your articulation of ideas, presentation and debating skills, and your ability to research, process and evaluate new ideas. It will also assist you to train and supervise junior staff members.

The course has been discussed in your performance appraisal and identified as a personal and professional goal. You have applied for study leave for private study during work hours; this request is still being processed. You are not in receipt of an allowance or reimbursement from your employer.

You will incur self-education expenses such as course fees, stationery and travel from work to the course.

Relevant legislative provisions

Income Tax Assessment Act 1997 Section 8-1.

Reasons for decision

Section 8-1 of the Income Tax Assessment Act 1997 allows a deduction for all losses and outgoings to the extent to which they are incurred in gaining or producing assessable income except where the outgoings are of a capital, private or domestic nature, or relate to the earning of exempt income.

Taxation Ruling TR 98/9 discusses the circumstances under which self education expenses are allowable as a deduction. A deduction is allowable for self education expenses if a taxpayer's current income-earning activities are based on the exercise of a skill or some specific knowledge and the subject of the self education enables the taxpayer to maintain or improve that skill or knowledge (Federal Commissioner of Taxation v. Finn (1961) 106 CLR 60, (1961) 12 ATD 348).

In your case it is accepted that the diploma undertaken will maintain or enhance the skills that are required in the performance of your current employment duties. Consequently, the self-education expenses incurred in undertaking this course have the necessary and relevant connection with the earning of your assessable income.

The cost of the course fees, stationary and your travel from work to the educational institution are therefore deductible as self-education expenses under section 8-1 of the ITAA 1997.

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