Private ruling: Self-education expenses
Published: May 2013
Ruling period: Year ending 30 June 2013
Date scheme commenced: 1 July 2012

Ruling: Q1: Are the expenses you incurred in undertaking a course allowable as a deduction? | A1: No

Relevant facts and circumstances: The arrangement that is the subject of the private ruling is described below. This description is based on the following documents. These documents form part of and are to be read with this description. The relevant documents are: · the application for private ruling · Copy of position description · Email You commenced employment as an administrative officer for an educational facility. You enrolled in a course and incurred expenses for the course. You were not encouraged by your employer to undertake the course.

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 (ITAA 1997) allows a deduction for all losses or outgoings to the extent to which they are incurred in gaining or producing assessable income, except to the extent that they are outgoings 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. Self-education expenses are deductible where they have a relevant connection to the taxpayer's current income earning activities. 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; (1961) 8 AITR 406). Similarly, if the study of a subject of self-education objectively leads to, or is likely to lead to an increase in a taxpayer 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 ( FC of T v. Maddalena (1971) 45 ALJR 426; (1971) 2 ATR 541; 71 ATC 4161). Your duties as outlined in your duty statement show that your role is administrative. Whilst we acknowledge that some of the subjects studied may have assisted you in your role as an administrative officer it is considered that the course is designed to enable individuals to gain specialised qualifications and that an insufficient nexus exists between your duties at the time you undertook the course and the course which you undertook. In addition, there is no indication that the project management course would lead to, or was likely lead to, an increase in your income from your employment as an administrative officer. As it is considered that there is insufficient nexus between your income earning activities as an administrative officer and the course the expenses you incurred to undertake the course were not incurred in gaining or producing your assessable income and therefore are not allowable as a deduction under section 8-1 if the ITAA 1997