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Edited version of your written advice
Authorisation Number: 1012978960875
Date of advice: 1 March 2016
Ruling
Subject: Self-education expenses
Question 1
Are you entitled to a deduction for the expenses incurred to attend the conference?
Answer
Yes.
This ruling applies for the following periods:
Year ended 30 June 2016
The scheme commences on:
1 July 2015
Relevant facts and circumstances
You are an employee at a business firm.
You will be attending an related conference
Your employer supports the relevance of the conference but are not prepared to fund the cost of the trip or the conference. They have however approved your attendance at the conference on full pay.
You have been directed to lodge all the conference presentation materials with your employer after your return to Australia.
You are aware that one of your employer's well-known competitors is now attending the conference on a regular basis, and to protect future income of your department, it is prudent if not commercially essential that you attend to protect the revenue from that client from not going to another firm.
You will incur the following expenses to attend the conference:
• Conference costs
• Air fares and transfers
• Accommodation and sustenance
It is your intention to fly non-stop to the conference just prior to commencement and to attend the conference and return non-stop shortly thereafter.
Relevant legislative provisions
Income Tax Assessment Act 1997 Section 8-1
Reasons for decision
Section 8-1 of the Income Tax Assessment Act 1997 (ITAA 1997) allows a deduction for all losses and outgoings to the extent to which they are incurred in gaining or producing assessable income, except to the extent to which they are of a capital, private or domestic nature, or relate to the earning of exempt income.
Taxation Ruling TR 98/9 discusses the deductibility of self-education expenses.
Paragraph 13 of TR 98/9 states:
If a taxpayer's income-earning activities are based on the exercise of a skill or some specific knowledge and the subject of self-education enables the taxpayer to maintain or improve that skill or knowledge, the self-education expenses are allowable as a deduction.
Thus, self-education expenses incurred by a taxpayer will qualify for deduction under section 8-1 of the ITAA 1997, if there is a sufficient nexus to the production of assessable income and the improvement of a skill or some specific knowledge.
Similarly, 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, a deduction is allowable.
Paragraph 23 of TR 98/9 states that subject to the general tests under section 8-1 of the ITAA 1997 being met, the following types of expenses relating to approved self-education are allowable deductions;
• course or tuition fees of attending educational institutions, conferences or seminars
• the cost of professional and trade journals, text books and stationery
• airfares incurred on overseas study tours, on work-related conferences or seminars, or attending educational institutions
• where a taxpayer is away from home overnight or temporarily, accommodation and meal expenses incurred on overseas study tours, conferences or seminars, or attending an educational institution
In your case, it is accepted that your attendance at the conference will maintain or enhance the skills that are required in the performance of your current role. 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 under section 8-1 of the ITAA 1997 for self-education expenses.
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