Private ruling: Self-education expenses
Date of advice: 17 August 2018
Published: October 2018
Ruling period: Year ended 30 June 2017
Date scheme commenced: 1 July 2016

Ruling: Q1: Is the cost of the Executive Masters program an allowable self-education expense? | A1: Yes 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 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). It is considered that the course of study will maintain or improve your skill or knowledge used in your current income earning activity. Consequently you are entitled to a deduction for self-education expenses incurred in relation to the course fees incurred.

Relevant facts and circumstances: You are currently employed as a manager of a large team of approximately X staff. Your responsibilities include staff management, workforce planning, service delivery, project management and quality assurance. You are seeking to improve your skills and knowledge in these areas both for your current role and for potential career advancement in the future. Your employer is providing you with extra study leave in order for you to complete the course.

Relevant legislative provisions: Income Tax Assessment Act 1997 Section 8-1