Private ruling: Education expenses
Published: May 2012
Ruling period: Year ended 30 June 2012
Date scheme commenced: 1 July 2011

Ruling: Q1: Are you entitled to a deduction for the expenses you will incur for your employee's education costs and allowa nces? | A1: Yes

Relevant facts and circumstances: You are proposing to financially support an employee undertaking an industry related degree. The expenses will include course fees, accommodation fees and flights. The employee will continue to work directly for the company in between university terms.

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 allows you a deduction for any loss or outgoing that is incurred in gaining or producing your assessable income, or is necessarily incurred in the carrying on of a business, to the extent that it is not of a private, capital or domestic nature. Generally, expenses incurred in respect of salary or wages, bonuses, gratuities, allowances and fringe benefits paid to an employee are deductible to the employer. In your situation, it is accepted that the expenses you incur in paying for your employee's education expenses have been necessarily incurred and you are entitled to a deduction for these costs.

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