Private ruling: Self-education expenses
Date of advice: 15 November 2019
Published: February 2020
Ruling period: Year ended 30 June 2019
Date scheme commenced: 1 July 2018

Ruling: Q1: Are you entitled to a deduction for self-education expenses? | A1: No.

Relevant facts and circumstances: You are employed by a company. You have been employed with the company for 12 months. You are undertaking University study. You state that you are required to undertake the study in order to maintain your employment. You provided a Commonwealth Assistance Notice that specified that you incurred the fees under HECS-HELP.

Relevant legislative provisions: Income Tax Assessment Act 1997 section 8-1 | Income Tax Assessment Act 1997 section 26-20

Reasons for decision: Summary: Expenses incurred in relation to a course of study may be deductible under the general deduction provisions of section 8-1 of the Income Tax Assessment Act 1997 (ITAA 1997) provided the course of study has a relevant connection to a taxpayer's current employment and the amount is not prevented from being deducted by another provisions of the tax law. Taxation Ruling TR 98/9 - Income tax: deductibility of self-education expenses incurred by an employee or a person in business notes that a course of study will generally be accepted as having a relevant connection to a taxpayer's current employment if it enables the taxpayer to maintain or improve skills or knowledge required in that employment. | Detailed Reasoning - HECS-HELP: Section 26-20 of the ITAA 1997 provides that the following amounts cannot be deducted under the ITAA 1997: · a student contribution amount within the meaning of the Higher Education Support Act 2003 (HESA) paid to a higher education provider (paragraph 26-20(1)(ca) of the ITAA 1997), and · a payment made to reduce a debt to the Commonwealth under Chapter 4 of the HESA (paragraph 26-20(1)(cb) of the ITAA 1997). HECS-HELP is granted to individuals under the provisions of the HESA for student contribution amounts and when granted, results in a debt to the Commonwealth under the provisions of Chapter 4 of the HESA. You are in receipt of HECS-HELP and paid your course fees via this method. As the amount imposed was a student contribution charge you are prevented from deducting the amount by the provisions of paragraph 26-20(1)(ca) of the ITAA 1997. In addition, under the provisions of paragraph 26-20(1)(cb) of the ITAA 1997, you cannot deduct any future payments to the Commonwealth that reduce your HECS-HELP debt. Accordingly, you are not entitled to a self-education expense for your course fees.