Private ruling: Self-education expenses
Date of advice: 14 April 2026
Published: 29 June 2026
Ruling period: Year ended 30 June 20YY | Year ended 30 June 20YY
Date scheme commenced: DD MM 20YY

Ruling: Q1: Are you entitled to a deduction for tuition fees for an overseas degree under section 8-1 of the Income Tax Assessment Act 1997 (ITAA 1997)? | A1: No. | Q2: Are you entitled to a deduction for airfares and accommodation expenses under section 8-1 of the ITAA 1997? | A2: No. | Q3: Are you entitled to a deduction for transport expenses under section 8-1 of the ITAA 1997? | A3: No. | Q4: Are you entitled to a deduction for your family's airfares, visa and education expenses under section 8-1 of the ITAA 1997? | A4: No. | Q5: Are you entitled to a deduction for conferences, reference materials, textbooks and subscriptions under section 8-1 of the ITAA 1997? | A5: No.

Relevant facts and circumstances: In 20YY, you commenced employment with Company A (your employer). You are employed on a full-time basis as a Managing Director. You are responsible for the oversight of strategy and operations of the organisation. Your responsibilities include: Strategy development and company performance assessment Theological and philosophical direction; at macro-level and within projects Budget management Staffing: recruitment, performance appraisal, professional development and management Regulatory compliance Project review Research and content creation Corporate governance On DD MM 20YY, you departed Australia with your spouse and children. You are residing at the rental property located at the property. Your rental agreement is for an initial XX months. In MM 20YY, you commenced a Master of Studies in Theology course with University A located overseas. The degree covers methods of ethical enquiry, key theological and philosophical thinkers in ethics and a range of contemporary ethical topics. The degree is focused on Christian approaches to ethics. The aims of the course are: • To impart understanding in depth of the distinct topics within the field of study. • To train students in the analysis and evaluation of both primary and secondary literature. • To teach students the art of selecting the most significant materials for their purpose and combining these to form a structured argument. • To develop the habits of critical questioning, clear exposition and objective evaluation. • To prepare students for further research. Travel grants are available to Theology and Religion graduate students. You expect to complete the course in MM 20YY. While undertaking the study you will be granted unpaid study leave and will remain employed while completing the course. You have not been reimbursed for your course fees or any associated expenses. You are not paying for the course fees using the Higher Education Loan Program.

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

Reasons for decision: Summary: The required nexus between the self-education expenses and the derivation of assessable income is not established. As the expense does not satisfy the requirements of section 8-1 of the ITAA 1997, the self-education expenses are not deductible. | Detailed Reasoning - Detailed reasoning: 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, or a provision of the ITAA 1997 prevents it. It is well established that the words 'in gaining or producing assessable income' are to be understood to mean 'in the course of' gaining or producing assessable income and do not convey the meaning of outgoings incurred 'in connection with' or 'for the purpose' of deriving assessable income. This means there must be a relationship, or close connection, between the expenditure and what it is that you do to produce your assessable income. Taxation Ruling TR 2024/3 Income tax: deductibility of self-education expenses incurred by an individual provides the circumstances under which self-education expenses are allowable as a deduction. Paragraph 22 of TR 2024/3 provides that self-education expenses are incurred in gaining or producing your assessable income if either or both of the following apply: • Your income-earning activities are based on the exercise of a skill or some specific knowledge and the self-education enables you to maintain or improve that skill or knowledge. (Principle 1). • The self-education objectively leads to, or is likely to lead to, an increase in your income from your current income-earning activities in the future. (Principle 2). Paragraph 23 of TR 2024/3 provides that self-education expenses are not incurred in gaining or producing your assessable income if either of the following apply: • The self-education will enable you to get employment, to obtain new employment or to open up a new income-earning activity (whether in business or in your current employment). This includes studies relating to a particular profession, occupation or field of employment in which you are not yet engaged. These expenses are incurred at a point too soon to be regarded as incurred in gaining or producing your assessable income. (Exclusion 1) • You are not undertaking income-earning activities to derive assessable income at the time you incurred the expenses. These expenses are not connected to any income-earning activity at the time they are incurred. (Exclusion 2) To determine whether the self-education expenses are deductible, it is necessary to consider the essential character of the expenditure, having regard to the connection between the course of study and your current income-earning activities. In this case, the course undertaken is of a general nature and provides broad, conceptual knowledge and skills that are not sufficiently specific to, or closely aligned with, your current duties. While it is accepted that the knowledge gained through the course may be relevant or useful to your work and may assist you to perform your role more effectively, relevance or usefulness alone is not sufficient to establish deductibility. For self-education expenses to be deductible, the study must maintain or improve the specific skills or knowledge upon which your income-earning activities are based or objectively lead to an increase in income from those same activities. Your current duties do not depend upon the application of postgraduate-level academic expertise in ethics. The course does not train, maintain or refine a discrete or identifiable employment skill required in carrying out those duties. Rather, the benefits derived from the course are broad, interpretive and developmental in nature, and are not directly connected to the performance of work functions. The connection between the course content and your income-earning activities is indirect and incidental, rather than direct and substantial. Any benefit obtained from the course arises from its general application rather than from a close relationship with the activities by which you derive assessable income. As the requisite nexus between the self-education expenses and the derivation of assessable income is not established, the expenditure is more accurately characterised as being incurred for general education and personal development. The expenses therefore do not satisfy the requirements of section 8-1 of the ITAA 1997 and are not deductible. | Summary: The airfare and accommodation expenses do not satisfy the requirements of section 8-1 of the ITAA 1997 and are not deductible. | Detailed Reasoning - Detailed reasoning: Airfares and accommodation expenses incurred in connection with self-education are only deductible where the underlying self-education activity itself has a sufficient and direct nexus with the derivation of assessable income. That is, the travel must be undertaken in the course of gaining or producing assessable income, rather than for private or general educational purposes. Where the primary purpose of the travel is to undertake non-deductible self-education, any associated airfares and accommodation expenses take on the same non-deductible character. In these circumstances, the travel is incidental to the course of study rather than to your income-earning activities. Further, even if the self-education expenses were otherwise deductible, the airfares and accommodation expenses would still not be allowable. You relocated overseas with your family for an extended period and resided in rental accommodation while undertaking the course. During this period, you were living at the location of the study rather than travelling away from home to undertake a short-term or temporary educational activity. Expenses incurred in establishing and maintaining a place of residence are of a private or domestic nature. Airfares to relocate and accommodation expenses incurred while living at the location of study are therefore not incurred in the course of gaining or producing assessable income and retain their private character. The airfare and accommodation expenses were not incurred in gaining or producing assessable income. The expenses do not satisfy the requirements of section 8-1 of the ITAA 1997 and are not deductible. | Summary: The transport expenses do not satisfy the requirements of section 8-1 of the ITAA 1997 and are not deductible. | Detailed Reasoning - Detailed reasoning: You are not entitled to a deduction for transport expenses under section 8-1 of the ITAA 1997. The transport expenses were incurred in connection with undertaking your course of study. As explained in Question 1, the course does not have a sufficient nexus with your current income-earning activities and the self-education expenses are not deductible. Transport expenses incurred to undertake self-education take their character from the self-education activity itself. As the underlying self-education expenses are not incurred in gaining or producing assessable income, the associated transport expenses are likewise not deductible. Accordingly, the transport expenses do not satisfy the requirements of section 8-1 of the ITAA 1997 and are not deductible. | Summary: The expenses are inherently private or domestic in nature and do not satisfy the requirements of section 8-1 of the ITAA 1997. | Detailed Reasoning - Detailed reasoning: You are not entitled to a deduction for your family's airfares, visa and education expenses under section 8-1 of the ITAA 1997. These expenses were incurred in relation to your family members and arise from personal decisions concerning family living arrangements, migration and education. They were not incurred in the course of gaining or producing your assessable income and do not have a direct or sufficient nexus with your income-earning activities. The expenses are also inherently private or domestic in nature and are therefore precluded from being deductible under paragraph 8-1(2)(b) of the ITAA 1997. | Summary: The expenses do not satisfy the requirements of section 8-1 of the ITAA 1997 and are not deductible. | Detailed Reasoning - Detailed reasoning: You are not entitled to a deduction for conferences, reference materials, textbooks and subscriptions under section 8-1 of the ITAA 1997. Your course of study does not have the requisite connection with your current employment, and the associated costs are therefore not incurred in gaining or producing your assessable income. The expenses do not satisfy the requirements of section 8-1 of the ITAA 1997 and are not deductible.