Private ruling: Self-education
Published: August 2014
Ruling period: Year ending 30 June 2014
Date scheme commenced: 1 July 2013

Ruling: Q1: Are you entitled to a deduction for overseas travel? | A1: No.


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 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 TR 98/9 states self-education expenses are allowable as a deduction 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. However, if the subject of the self-education is too general in terms of the taxpayer's income-earning activities, the necessary connection between the self-education expense and the income-earning activity does not exist. You travelled overseas at the invitation of the not-for- profit organisation to conduct a Training Conference. It is arguably the case that anyone who volunteers their professional services during times of crisis may well benefit professionally from the experience to some degree. It is not considered, however, that this in itself would be enough to conclude that the cost incurred by such volunteers would be tax deductible. In Case U109 87 ATC 657, the taxpayer was a science teacher who specialised in geology and was the head of the school science department. He undertook a 17 day trip to Indonesia organised by a natural museum history society of which he was a member. During the course of the trip he visited several volcanoes and other geological sites, and attended a geological congress. He also visited some tourist attractions. The taxpayer took many slides of the geological sites and prepared a taped commentary which he used in his teaching on his return. The Administrative Appeals Tribunal (AAT) examined previous court decisions dealing with teachers who had claimed for the cost of overseas travel. It concluded that the general principle in these cases was that the fact that the taxpayer may have been a better teacher after the travel was not enough to demonstrate a sufficient connection between the travel and their income earning activities. The AAT stated that some taxpayers are fortunate in finding personal and recreational satisfaction in their field of endeavour and that in this case the trip was recreational in character and not deductible. In your case, you volunteered your time to present at a training conference. While it is considered that volunteering ones time and skill is commendable and you may have become a better teacher because of the experience, you used your existing skills to help the people but you did not receive training. It is considered that any knowledge gained is too general and does not have a sufficient connection to the duties of your employment. Accordingly, the expenses you incurred in respect of your overseas trip are not an allowable deduction.

You travelled overseas to present as a volunteer at a training conference. | The trip was organised a not for profit organisation. | Your food and accommodation were paid for by the organisation. | You were not paid by either your employer or the organisation.