Private ruling: Self-education expenses
Published: February 2015
Ruling period: Year ended 30 June 2014
Date scheme commenced: 1 July 2013

Ruling: Q1: Are you entitled to a deduction for self-education expenses? | A1: Yes.

Relevant facts and circumstances: You held a Bachelor degree. You commenced post-graduate Masters studies. You received a job offer and signed a contract of employment. After signing the contract you changed your enrolment and selected subjects which would best enhance your performance in your employment position. It was not a requirement of your employment that you undertake the study. You incurred the expenses relating to the courses after you had accepted the offer of employment.

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 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 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). In your case, it is considered that the study will maintain or improve your skill or knowledge required in your employment position with your employer, and as such the course fees are deductible in the financial year they were incurred.