FocusOn - Self-Education Expenses

Self-education expenses relate to a course of education provided by a school, college, university, or other place of education. Included in these costs are tuition fees, student union fees, seminar and conference fees, textbooks, stationery, interest on loans taken out to fund self-education, motor vehicle and home office running costs and depreciation of office equipment. HELP (previously HECS) contributions and interest on loans taken out to repay HELP are not deductible.

Claiming self-education expenses

You can claim self-education expenses only where there is a direct connection between your studies and your current work activities, such as:

	The study is enabling you to maintain or improve the skills and knowledge required to perform your current work activities, or
	The study will lead to increased earning capacity from your current work activities.

Studies for reasons other than those listed above may not be eligible for a deduction claim. For example, self-improvement, motivation, stress management and personal development courses are generally not deductible. Investment seminars are also non-deductible unless there is a direct connection to your current investment portfolio.

You cannot claim a deduction for self-education expenses incurred to enable you to obtain a new job or commence a new business. For this reason, self-education expenses are not automatically deductible simply because you have a part-time job or even a full-time job in the same field as your study. Care must be taken in determining the deductibility of your self education expenses by assessing the facts of your particular situation. We recommend you to contact us for further discussion on this matter.

$250 non-deductible amount

Please note that the first $250 of self-education expenses is not deductible. However, certain non-deductible expenses can be used to offset this amount.

Travel expenses

For a domestic or overseas study tour you may be able to claim fares, meals and accommodation expenses whilst away from home. However, meals and accommodation will not be deductible if you establish a new home overseas. A deduction may also be available if you attend seminars or conferences or attend a place of education away from home and are required to stay overnight.

Motor vehicle expenses

If you travel directly from home to your place of education and return home, or from work to your place of education and back to work, the expenses associated with this travel are deductible. If you travel from home to your place of education then to work, or from work to your place of education then home, only the first leg of each trip is deductible. Please refer to the figure overleaf for illustration. However, the costs of the second non-deductible leg of each trip can be offset against the $250 non-deductible amount as discussed above.

Child care

The costs of child care while you are attending your place of education are non-deductible, but can be offset against the $250 non-deductible amount.

Home office expenses

You can claim a deduction for running costs (gas and electricity) associated with a home office used for study. This can be calculated by multiplying the number of hours the home office was used for study by the Australian Taxation Office’s approved claim rate, currently 26 cents per hour.

Computers, office furniture and other equipment

If you acquire computers, office furniture or other equipment for your study, you can claim a portion of these expenses. If the item cost less than $300, a claim may be made for the portion that relates to study as an outright deduction. Items greater than this amount are depreciated over a number of years.

Note that if you use the 26 cents per hour rate for home office expenses, you cannot claim the cost of office furniture as the depreciation of these items is included in the hourly rate.

Record keeping

You are required to maintain all receipts for five years from the date your income tax return was lodged. To substantiate a claim for home office expenses, you are required to maintain a time diary for one month each financial year.

Required documents

In order to claim self-education expenses, you should provide the following documents, if:

	A summary of your self-education expenses, including any equipment purchased, such as computers or office furniture
	A reasonable estimate of the number of kilometres travelled in relation to your self-education and the engine size of your vehicle
	The number of hours per week you used your home office for self study purposes

Published : 6 July 2007