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Edited version of your private ruling
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Ruling
Subject: FEE-HELP
Question
Does utilising the FEE-HELP system to pay course fees preclude you from claiming a deduction for the fees as a self education expense?
Answer
No.
This ruling applies for the following period:
Year ended 30 June 2011
The scheme commences on:
1 July 2010
Relevant facts and circumstances
You are currently completing a post graduate degree.
The course is directly related to your work.
You began studying this course part time, and intend to continue this study part-time over the next few years.
The course fees were paid under the FEE-HELP system.
Relevant legislative provisions
Income Tax Assessment Act 1997 section 8-1 and
Income Tax Assessment Act 1997 section 26-20.
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 where the outgoings are of a capital, private or domestic nature, or relate to the earning of exempt income.
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 have stated that your study is directly related to your work. Therefore, the course fees are deductible in the year in which they were incurred even though you have obtained a loan for all or part of those fees under FEE-HELP.
Additional information
FEE-HELP debts are loaded onto your account when they are reported to the Australian Taxation Office by the Department of Education, Employment and Workplace Relations.
If the period of study is from:
1 January to 30 June (first half of the year), your debt for that semester is usually reported and loaded in November in the same year of study
1 July to 31 December (second half of the year), your debt for that semester is usually reported and loaded in May, following the year of study
If you are entitled to a deduction for course fees, you should use the statements from your study provider to determine the amount you are entitled to claim in a particular financial year.