Private ruling: self-education expenses
Published: May 2014
Ruling period: Year ended 30 June 2014
Date scheme commenced: 1 July 2013

Ruling: Q1: Are you entitled to a deduction for the costs associated with becoming an accredited professional? | A1: Yes.


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

Reasons for decision: Summary: Section 8-1 of the Income Tax Assessment Act 1997 states that you can deduct from your assessable income any loss or outgoing to the extent to which it is incurred in gaining or producing your assessable income, except where the loss or outgoing is of a capital, private or domestic nature. 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). Taxation Ruling TR 98/9 also states that 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. In your case, you are employed as a professional. Gaining the accreditation will allow you to certify work done and you will receive a higher income but not change your duties further. It is considered that the course will improve your skill or knowledge and will lead to an increase in your income. Therefore, you are entitled to a deduction for the cost of gaining the accreditation.

Relevant facts: You are employed full time as a professional. | You are undertaking a course to become an accredited professional. | You are a supervisor but until you become accredited, you are not allowed to certify that work has been carried out in accordance with the relevant standards. | After becoming accredited, you will receive higher pay and be able to certify work done. | Except for being able to certify the work your duties will not change.