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Edited version of your written advice
Authorisation Number: 1012737463668
Ruling
Subject: Self-education expenses
Question 1
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 ending 30 June 2015
Year ending 30 June 2016
The scheme commences on:
1 July 2013
Relevant facts and circumstances
This ruling is based on the facts stated in the description of the scheme that is set out below. If your circumstances are materially different from these facts, this ruling has no effect and you cannot rely on it. The fact sheet has more information about relying on your private ruling.
You commenced employment in 20XX.
You are responsible for developing and implementing public policy and training state wide.
You plan on completing a Master of Business. This course will give you the skills that are required for your current role to develop policy and guidance documents for use by numerous stakeholders.
Relevant legislative provisions
Income Tax Assessment Act 1997 Section 8-1.
Income Tax Assessment Act 1997 Section 26-20.
Reasons for decision
Section 8-1 of the Income Tax Assessment Act 1997 (ITAA 1997) states that you can deduct from your assessable income any loss or outgoing to the extent to which it is incurred in gaining or producing your assessable income, except where the loss or outgoing is of a capital, private or domestic nature.
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).
Taxation Ruling TR 98/9 also states that if the study of a subject of self-education objectively leads to, or is likely to lead to, an increase in a taxpayer's income from his or her current income-earning activities in the future, the self-education expenses are allowable as a deduction.
Section 26-20 of the ITAA 1997 outlines the availability of deductions in respect of certain student assistant programs. There is nothing in this section or any other taxation provision that precludes a deduction for course fees incurred where a taxpayer has obtained a loan for all or part of the fees for the course under FEE-HELP.
In your case you plan on completing a Master of Business. It is accepted that this course will maintain and enhance the skills that are required in the performance of your current employment activities.
Consequently, as there is the necessary connection between the course and your current income-earning activities you are entitled to claim a deduction for your course expenses under section 8-1 of the ITAA 1997.
Additional information
Please note that the self-education expenses you can deduct may be subject to a reduction of up to $250 in accordance with section 82A of the Income Tax Assessment Act 1936. An explanation on how this provision operates is provided at paragraphs 119 to 155 of TR 98/9, which can be accessed on the Tax Office's website at www.ato.gov.au.
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