Private ruling: Deductions - Self-Education Expenses
Date of advice: 18 August 2025
Published: 27 October 2025
Ruling period: DD MM YY
Date scheme commenced: DD MM YY

Ruling: Q1: Are your self-education expenses, detailed in Group A, incurred in studying a Master of XXXX allowable deductions under section 8-1 of the Income Tax Assessment Act 1997 (ITAA 1997)? | A1: No. | Q2: Are your self-education expenses, detailed in Group B, incurred in studying a Master of XXXX allowable deductions under section 8-1 of the ITAA 1997? | A2: No. | Q3: Are your self-education expenses, detailed in Group C, incurred in studying a Master of XXXX allowable deductions under section 8-1 of the ITAA 1997? | A3: Yes.

Relevant facts and circumstances: You are a citizen of Country X. You completed a bachelor in XXXX, which is not automatically recognised in Australia. On DD MM YY, you were granted a student visa from the Australian Government, Department of Home Affairs. On DD MM YY, you arrived in Australia. On DD MM YY you commenced a Master of XXXX at an Australian University. Between DD MM YY and DD MM YY, you were employed with Company A. Your duty statement confirms your role and responsibilities. Between DD MM YY and DD MM YY, you were employed with Company B. Your duty statement confirms your role and responsibilities. On DD MM YY, you were granted a Temporary Graduate visa from the Australian Government, Department of Home Affairs. On DD MM YY, you obtained employment with Company C. Your duty statement confirms your role and responsibilities. On DD MM YY, you completed the course. On DD MM YY, you obtained a permanent promotion with Company C

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

Reasons for decision: Summary: No. You cannot claim a deduction for the course fees you incur for the units of study in Group A. At the time you incurred the expenses, you were not undertaking income-earning activities to derive assessable income. These expenses are not connected to any income-earning activity at the time they were incurred. | Detailed Reasoning - Question 2: Are your self-education expenses, detailed in Group B, incurred in studying a Master of XXXX allowable deductions under section 8-1 of the ITAA 1997? | Summary: No. You cannot claim a deduction for the course fees you incur for the units of study in Group B. There is an insufficient connection between these units of study and your roles.The Group B subjects are considered too general in nature. | Detailed Reasoning - Question 3: Are your self-education expenses, detailed in Group C, incurred in studying a Master of XXXX allowable deductions under section 8-1 of the ITAA 1997? | Summary: Yes. You are entitled to claim a deduction for the course fees you incur for the units of study in Group C. There is a sufficient connection between each Group C unit of study and your employment roles. | Detailed Reasoning - Detailed reasoning: 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 2024/3 Income tax: deductibility of self-education expenses incurred by an individual , discusses circumstances in which self-education expenses are allowable. 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). This means there must be a relationship, or close connection, between the expenditure and what it is that you do to produce your assessable income, or if none is produced, would be expected to produce your assessable income (paragraph 15 of TR 2024/3). It is not enough to show only that there is some perceived connection, general link or causal connection between the expenditure and the production of your income. The expenditure must have a close connection to the performance of the duties and activities through which you earn your income (paragraph 16 of TR 2024/3). Paragraph 23 of TR 2024/3 states: 23. Self-education expenses are not incurred in gaining or producing your assessable income if either of the following apply: • The self-education will enable you to get employment, to obtain new employment or to open up a new income-earning activity (whether in business or in your current employment). This includes studies relating to a particular profession, occupation or field of employment in which you are not yet engaged. These expenses are incurred at a point too soon to be regarded as incurred in gaining or producing your assessable income. • You are not undertaking income-earning activities to derive assessable income at the time you incurred the expenses. These expenses are not connected to any income-earning activity at the time they are incurred. | Detailed Reasoning - Application to your circumstances: To determine whether circumstances exist that support your self-education deductions, it is necessary to determine whether there is a sufficient connection between you incurring your course fees and your current income earning activities. Whether such a connection exists is a question of fact and is to be determined by reference to all the facts in your case. You were not employed whilst completing the Group A subjects. Whilst employed in the various roles with Company A, B, and C you completed XX subjects. These subjects are listed in Group B and Group C. | Detailed Reasoning - Group A subjects:: At the time you incurred the self-education expenses, you were not undertaking income-earning activities to obtain assessable income. These expenses are not connected to any income-earning activity at the time they were incurred and you were not yet engaged in a relevant field of employment. You cannot claim a deduction for the course fees you incur for the units of study in Group A. | Detailed Reasoning - Group B subjects:: The Group B subjects you completed whilst employed by Company A, B, and C are considered too general in nature. We acknowledge there may be some minor connection, but the specific skills and knowledge gained from the remaining subjects lack the substantive connection to your income producing activities. The high-level knowledge and skills acquired from the Group B subjects are well beyond your requirements for your roles. There is an insufficient connection between these units of study and your roles. The self-education expenses related to the Group B subjects are not allowable deductions under section 8-1 of the ITAA 1997. | Detailed Reasoning - Group C subjects:: After analysing each subject outline against the relevant roles and considering your explanation of how the subjects maintained or improved a skill or knowledge specific to the work activities, we have concluded the Group C subjects have the relevant connection to your relevant income earning activities. Therefore, you are entitled to claim a deduction for the self-education expenses for the four Group C subjects under section 8-1 of the ITAA 1997.