Private ruling: Self education expenses
Date of advice: 16 September 2016
Published: November 2016
Ruling period: For year ended 30 June 2016.
Date scheme commenced: 1 July 2015.

Ruling: Q1: Can you claim a deduction for university fees you paid for a self-education course? | A1: Yes

Relevant facts and circumstances: You are employed by an Australian company. You commenced employment from dd/mm/yyyy. You study part time while working full time. You have enrolled in a course with an Australian university. As stated by your employer, you are required to learn and improve your attributes to help improving the company performance. Your employer confirms the above course is essential for you to maintain and expand the skills that are needed to excel in your current position as a supply and distribution manager. You have paid the required course fees.

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 expense of self-education. It is considered that 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.