Edited version of your private ruling

Authorisation Number: 1012439924722

Ruling

Subject: Self-education expenses

Question 1

Are you entitled to a deduction for your course fees as a self-education expense?

Answer

No.

Question 2

Are you entitled to a deduction for other expenses relating to your course as self-education expenses?

Answer

Yes.

This ruling applies for the following periods

Year ending 30 June 2013
Year ending 30 June 2014
Year ending 30 June 2015
Year ending 30 June 2016

The scheme commenced on

1 July 2012

Relevant facts and circumstances

You are employed in an educational capacity.

You instruct in a subject area a number of days per week. On the other days you are available for casual relief work.

You are undertaking a university course on an off-campus basis. You have a Commonwealth supported place (CSP) on the course.

As part of the course you will complete two units in each of the four disciplines - one of which you instruct in.

You expect to incur the following expenses in completing your course:

· student contribution fees

· student union fees

· textbook and stationery costs

· travel to compulsory internal study schools, and

· accommodation whilst attending the study schools.

Relevant legislative provisions

Income Tax Assessment Act 1997 Section 8-1
Income Tax Assessment Act 1997 Subsection 26-20(1)

Reasons for decision

Summary

You are entitled to a deduction for costs associated with undertaking your course as a sufficient connection exists between your employment and the course content. However, no deduction is allowable for the student contribution amount associated with the course

Detailed reasoning

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. No deduction is allowed were a specific provision of the taxation legislation prohibits it.

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 your 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.

TR 98/9 also discusses the types of self-education expenditure that are considered to be allowable. These include:

· some course or tuition fees (see below for further discussion)

· books, journals and stationery

· accommodation and meals where you are required to be away from home overnight in connection with a self-education activity, and

· depreciation on a computer or laptop and internet access although only the study related usage proportion may be claimed.

Course or tuition fees incurred in attending an education institution, including student union fees, are allowable expenses under section 8-1 of the ITAA 1997. However, subsection 26-20(1) of the ITAA 1997 prevents a deduction for certain assistance provided to students. You cannot claim a deduction for:

· a student contribution amount within the meaning of the Higher Education Support Act 2003 paid to a higher education provider, or

· a payment to reduce a debt to the Commonwealth under Chapter 4 of that Act.

In your case, it is considered that there is a sufficient connection between your duties and the content of your course.

Your place in the course is a CSP which requires you make a student contribution. This student contribution can be either made to the university or become a debt to the Commonwealth and paid at a later date.

By virtue of subsection 26(1) of the ITAA 1997 you are not entitled to a deduction for the student contribution whether paid at the time of your study or the Commonwealth as a repayment of a debt.

You are entitled to a deduction for other expenses related to your course including the cost of travelling to and attending residential study schools.

For more information regarding self-education expenses a copy of Taxation Ruling TR 98/9 can be found on our website www.ato.gov.au.