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Edited version of your private ruling
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Ruling
Subject: Education tax refund
Question
Do the following items qualify as eligible education expenses for the purposes of the Education Tax Refund (ETR)?
o Cost of electricity used to run computers
o Cost of renting the copper telephone line for home internet connection.
Answer: Yes.
This ruling applies for the following period
Year ended 30 June 2010
The scheme commenced on
1 July 2009
Relevant facts and circumstances
Your computers run on electricity.
Your home internet connection is established and maintained over a copper telephone line.
Relevant legislative provisions
Income Tax Assessment Act 1997 Subsection 61-640(4)
Reasons for decision
The ETR is a new government initiative to help with the cost of educating primary and secondary school children. It means eligible parents, carers, legal guardians and independent students could get 50% back on some education expenses made during the income year.
Subsection 61-640(4) of the Income Tax Assessment Act 1997 outlines expenses which are eligible for the ETR and includes expenses relating to home computers and costs associated with running them. Also included are the cost of establishing and maintaining home internet connection.
In your case, you have incurred expenses relating to the cost of electricity to run your home computers and the cost of renting the copper telephone line for your home internet connection.
It is considered that these are eligible education expenses for the purposes of the ETR.
As the phone line and home computers are used for other purposes, the expense must be apportioned in a fair and reasonable manner.