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Edited version of private advice
Authorisation Number: 1012700285392
Ruling
Subject: Self-education
Question
Are you entitled to a deduction for self-education expenses?
Answer
Yes.
This ruling applies for the following periods
Year ended 30 June 2014
Year ended 30 June 2015
Year ended 30 June 2016
Year ended 30 June 2017
The scheme commenced on
1 July 2013
Relevant facts
You are an employee.
Your role is to manage client relationships and advise clients on ways to mitigate risk.
You need to understand processes and you also train other employees.
You undertook a course.
You have incurred costs for the course and for books.
Your employer has provided a letter detailing that they consider that the study will assist you with your current income earning activities. Your employer also supports your study by providing study leave and upon successful completion of each subject they will reimburse you half of the costs per subject.
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 Income tax: deductibility of self-education expenses incurred by an employee or a person in business, 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 modules will maintain or enhance the skills that are required in the performance of your current employment duties. Consequently the self-education expenses incurred have the necessary and relevant connection with the earning of your assessable income. You are therefore entitled to a deduction for the portion of your expenses that is not reimbursed by your employer.
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