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Edited version of your written advice
Authorisation Number: 1051479812479
Date of advice: 5 February 2019
Subject: Self-education expenses
Are the course fees paid in connection with a self-education course an allowable deduction to the extent that the course fees are not reimbursed by your employer?
Are the travel, accommodation and meal costs associated with a study-tour to Country X, and also associated with attending intensive classes in a city of Australia, incurred in connection with a self-education course an allowable deduction, to the extent that these costs are not reimbursed by your employer and do not relate to any other purpose?
Your self-education expenses are deductible, as it is accepted the study meets the requirements detailed in Taxation Ruling TR 98/9. Further information about self- education expenses can be found by searching 'QC 31970' on ato.gov.au
This ruling applies for the following periods:
Year ending 30 June 20XX
Year ending 30 June 20XX
Year ending 30 June 20XX
The scheme commenced on:
1 July 20XX
Relevant facts and circumstances
You are currently employed on a full time basis, having commenced in late 20XX.
Your employer is wholly owned by a privately owned multi-national company.
You work as part of a small Australian team, and due to this you also support the head multi-national companies other Australian activities and projects on occasions.
In early 20XX your employer seconded you to a related Company (that is also owned by the same privately owned multi-national company) to take on a similar role to that of your other employment position.
You have moved to another state in Australia for the duration of the secondment, where you have signed a lease agreement to rent a residential property in the capital city of that Australian state, where you will be living in until early 20XX.
You have chosen to undertake a self-education course, of which all of the individual subjects relate to both your current employment secondment role, and also that of your other employment position.
You have also chosen to undertake the self-education course in order to gain a better understanding of relevant concepts in order to assist you in both your current employment secondment role, and also that of your other employment position, and to also increase both your skills and future advancement opportunities in both roles.
The course also has a subject which involves an overseas study tour to Country X.
Costs and travel expenses
Your employer is supporting you in completing the self-education course and will be providing you with:
● 20 days paid study leave to attend the course;
● Reimbursement of up to a certain amount towards the course fees on successful completion of the course; and
● Payment of certain airfares from the city where you are currently residing to the city in which your usual employment position is based for business purposes, which may be scheduled to facilitate your attendance at intensive classes for the self-education course (subject to business needs).
You are eligible for and will be using FEE-HELP to assist you in paying the course fees, and subject to the reimbursement from your employer, you are funding your own educational expenses via FEE-HELP.
You will also incur the following expenses:
● Course fees;
● Airfares to attend the overseas study tour component of the self-education course;
● Accommodation and meals for the Overseas study tour to Country X;
● Airfares to travel to and from the city where you are currently residing to the city where the self-education course is being delivered (in a different state of Australia), in order to attend the intensive classes for the self-education course (except to the extent that these are paid for by your employer);
● Accommodation and meals for the intensive class attendances; and
● Books, journals and stationary.
You will be maintaining your existing lease on your primary residence in the city where you are currently residing whilst attending the intensive classes for the self-education course.
The deduction you wish to claim for the course fees is the total cost of the course, less an amounts paid under a scholarship and the anticipated reimbursement from your employer. This amount that you wish to claim as a deduction will be deferred under FEE_HELP.
You anticipate that some of your travel costs relating to your travel from the city where you are currently residing to attend the course that is being delivered in a different state of Australia may be reimbursed by your employer.
You have also provided the following information about your related travel, including whether any additional time will be spent on each trip for other purposes, and confirmation of the amount of deductions you wish to claim for each travel expense:
● You intend on staying on for a small amount of time during the first trip from the city where you are currently residing to the city where the self-education course is being delivered in early 20XX, as your employer has requested that you spend this additional time in their office in a nearby city in Australia. You intend on claiming the cost of meals and accommodation for the duration of the course only. You expect that your flights will be paid by your employer for this trip, however if this changes you will also be seeking to claim a deduction for those costs.
● Regarding the other planned trips from the city where you are currently residing to the city where the self-education course is being delivered in mid 20XX and early 20XX, it is currently unknown as to whether you will be staying on for any additional time. However the deductions you seek to claim are in line with trip mentioned above.
● Regarding the overseas study tour to Country X in early to mid 20XX, it is likely that you will be spending additional time in Country X, other than for the purpose of the study trip. As your employers parent Company is based in Country X, you anticipate that a small number of additional days will be spent in Country X meeting with your counterparts in the head office and build your understanding of their global business. You also anticipate on spending a small amount of time enjoying personal travel in Country X.
● No costs are expected to be covered by your employer, other than for the additional days visiting the Company’s head office in Country X.
● You will be seeking to claim a deduction for meals, accommodation and travel which solely relate to the course (course attendance days only).
● You will not be seeking to claim any costs associated with travelling to the Companies head office in Country X, or for personal travel.
● You also propose to claim a deduction for the cost of flights in proportion to the number of days you attend the study tour component of your self-education course. This is in line with paragraph 17 of Taxation Ruling TR 98/9, which covers apportionment where there are two different purposes for the travel.
The study you will be undertaking is highly relevant to your current employment and therefore there is a sufficient connection between the skills and knowledge required in your current position and the self-education course.
You have made reference to paragraph 89 of TR 98/9, which provides that where a taxpayer is away from home overnight in connection with a self-education activity, accommodation and meal expenses incurred are deductible.
You also advise that you are entitled to claim a deduction relating to the flights, accommodation and meals due to the following:
● you will be away from home overnight for each of the EMBA intensive blocks of study, along with the study tour; and
● you will be maintaining your usual place of residence in Darwin and will be staying in hotels near to the University both while attending the educational institution and study tour; and
● you will be returning home after each intensive block of study and the study tour.
Relevant legislative provisions
Income Tax Assessment Act 1997 section 8-1
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