Private ruling: Self-education expenses
Date of advice: 29 May 2018
Published: August 2018
Ruling period: Year ending 30 June 2017 | Year ending 30 June 2018 | Year ending 30 June 2019
Date scheme commenced: 1 July 2016

Ruling: Q1: Are you eligible to claim a deduction for fees paid in connection with a self-education course? | A1: Yes

Relevant facts and circumstances: You are an officer with a Government department. You role involves analysing and researching, developing and communicating advice and issues to the Government. You enrolled in a related course at University to improve your skills. This degree is designed for graduates who are currently working in this area, and allows you to improve your skills in specific processes, analysis and research. This degree will provide you with the skills to carry out your role more effectively. Your employer supports this degree and identifies it as relevant to your work. You employer provides financial assistance and study leave to attend classes and exams. You have not changed your role since starting this 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 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). Further, paragraph 26 of TR 98/9 states that expenses relating to self-education which are compulsory and unavoidable, as well as those for which a need can be shown in terms of fulfilling the requirements of the course, are regarded as being 'necessarily incurred' and are expenses of self-education. The study will maintain or improve your skill or knowledge used in your current income earning activity. Consequently you are entitled to a deduction for the course fees incurred.

You are entitled to a deduction for your self-education expenses as they are incurred to maintain or improve your skill or knowledge used in your current income earning activity.