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Edited version of your written advice
Authorisation Number: 1051453340698
Date of advice: 14 November 2018
Ruling
Subject: Self-education expenses
Question 1
Are the course fees deductible?
Answer
Yes
Question 2
Are the associated travel expenses incurred in relation to your study deductible?
Answer
Yes
This ruling applies for the following periods:
Year ending 30 June 2018
Year ending 30 June 2019
Year ending 30 June 2020
The scheme commences on:
1 July 2017
Relevant facts and circumstances
You are a police officer.
Your primary role is to perform general duties policing within a district.
In addition to your primary role you perform additional water policing duties.
You have undertaken an internal course to be certified to operate small police boats within the police force.
You are deemed to be a master of the vessel when operating police vessels.
In this role you do the following:
● Conduct and co-ordinate search and rescue operations. This involves operating Police vessels as required in conjunction with other agencies
● Organise and plan training days to deliver to other police. This requires you to deliver instructions on nautical knowledge, elements of shipboard safety, engineering, maintenance and maritime legislation
● Conduct maritime operations and enforcement duties e.g. breath testing, safety compliance
● Co-ordinate and supervise re certification of current small boat operators
You are enrolled and are completing a Certificate II in Maritime Operations.
Completing this course will allow you to join the water police.
You are not receiving any allowances or additional leave from your employer to undertake this course.
You pay these expenses yourself; you are not reimbursed by your employer.
You will be required to travel to complete aspects of your course in the current and future financial year.
You will use your own car to undertake this travel.
You will also require accommodation whilst undertaking aspects of the course. You will pay for this yourself. You will not be reimbursed by your employer.
You do not receive a travel allowance from your employer for this travel.
Reasons for decision
Detailed reasoning
Section 8-1 of the Income Tax Assessment Act 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.
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 (Federal Commissioner of Taxation v. Finn (1961) 106 CLR 60, (1961) 12 ATD 348
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.
However, no deduction is allowable for self-education expenses if the study is designed to enable a taxpayer to open up a new income-earning activity, whether in business or in the taxpayers current employment. Such expenses of self-education are incurred at a point too soon to be regarded as incurred in gaining or producing assessable income (see Federal Commissioner of Taxation v. Maddalena (1971) 45 ALJR 426; (1971) 2 ATR 541; 71 ATC 4161; and paragraphs 15, & 48 62 of TR 98/9).
Studies undertaken in order to obtain employment in a new field are considered to have been incurred at a point too soon to be regarded as incurred in gaining or producing assessable income and such expenses are not deductible
Application to your circumstances
We consider that based on your current responsibilities in your role that involve the operating of police boats, that the study you are undertaking is related to your current income producing activities and will improve that skill or knowledge.
Accordingly your course fees and associated travel expenses including car and accommodation expenses are deductible.