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Edited version of private advice
Authorisation Number: 1051595258846
Date of advice: 17 October 2019
Ruling
Subject: Self-education expenses
Question
Are you entitled to a self-education deduction for the course fees for a Masters of business Administration (MBA)?
Answer
Yes
This ruling applies for the following periods:
Year ending 30 June 20XX
Year ending 30 June 20XX
The scheme commences on:
1 July 20XX
Relevant facts and circumstances
You are a resident of Australia for taxation purposes.
You are currently a director and full-time employee of a company.
You are currently undertaking a MBA.
You are undertaking this study to further develop your leadership and business skills.
The MBA covers the following subjects:
· Leadership
· Data analysis
· Financial accounting
· Managerial economic
· Managing people
· Marketing
· Business strategy
· Global business economics
· Operations
You are responsible for implementing a focused and coherent sales and service strategy within the region.
You are responsible for successfully creating brand awareness, establishing strong relationship with new and existing customers, identifying target markets, communicate innovation and strategic activity with key stakeholder + build a sustainable business outside the European market.
Your employer has not contributed to the costs associated with the MBA.
You are a full fee paying student.
Relevant legislative provisions
Income Tax Assessment Act 1997 Section 8-1.
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.
Taxation Ruling TR 98/9 Income tax: deductibility of self-education expenses incurred by an employee or a person in business discusses circumstances in which self-education expenses are allowable as a deduction under section 8-1 of the ITAA 1997. If a taxpayer's current income-earning activities are based on the exercise of a skill or some specific knowledge and the self-education enables the taxpayer to maintain or improve that skill or knowledge, the self-education expenses are allowable as a deduction.
In addition, 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, the self-education expenses are allowable as a deduction.
The Commissioner is satisfied that there is a sufficient connection between the skills and knowledge required in your current duties as an employee of the company and the MBA.
Accordingly, you are entitled to a deduction for the course fees associated with the MBA.