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Ruling
Subject: Self education
Question
Are you entitled to a deduction for self education expenses?
Answer
Yes.
This ruling applies for the following period:
Year ended 30 June 2012
The scheme commences on:
1 July 2011
Relevant facts and circumstances
You hold a Masters qualification.
A condition of your employment was to gain a PhD in a relevant area or significant/substantial progress towards the completion of a PhD.
In order to meet this requirement, you were required to produce an edited and peer reviewed thesis.
You completed your PhD and have met the conditions of academic probation and your employment status is now ongoing.
The data and findings in your thesis are relevant to your employment duties.
After completing your PhD, you are now eligible for promotion.
You have incurred expenditure to have your work professionally edited.
Relevant legislative provisions
Income Tax Assessment Act 1997 section 8-1.Reasons for decision
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.
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.
A condition of your employment was that you gained a PhD in a relevant area. It is accepted that the PhD you have completed will enhance the skills required in the performance of your duties. 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 for self-education expenses.