What are self-education expenses?
Self-education expenses are incurred when you:
- Undertake courses at an educational institution (whether or not the courses result in a formal qualification).
- Undertake courses offered by industry organisations or professionals.
- Attend work-related conferences or seminars.
- Do self-paced learning and study tours (whether overseas or within Australia).
What are the eligibility requirements to claim self-education expenses?
You will be allowed to claim a deduction for a self-education expense if, when expenses are incurred, it has a sufficient connection to making money from your employment activities. Self-education has enough connection to earning your employment income if it either:
- Improves or maintains the specific skills or knowledge you need for your current employment activities.
- Leads to, or is intended to lead to an increase in your income from your existing employment activities.
Your employment activities are tasks expected of you to perform your job and are set out in your duty statement. You may also qualify if you undertake a course to maintain your right to receive a taxable bonded scholarship.
In some situations, only the expenses incurred for certain components or subjects of your self-education will have enough connection to making employment income.
When you are not allowed to claim a deduction
You won’t be able to claim a deduction for a self-education expense if, when you incur the expense:
- It doesn’t have enough connection to your employment activities.
- You are not employed.
- It relates in a general way to your employment activities.
- It allows you to change or get new employment, such as a café worker studying Hotel management or a nurse completing a Medical degree to become a doctor.
Taxable bonded scholarship recipients
You are allowed to claim a deduction for self-education expenses if you are enrolled in a course to meet study requirements to maintain your right to a taxable bonded scholarship. If you are an employee of the scholarship provider, work-related self-education rules apply.
Expenses you can claim
If your self-education expenses meet the eligibility rules, you will be allowed to claim a deduction for the following expenses:
- Tuition, course, conference, or seminar fees
- General course expenses
- Decline in value of depreciating assets
- Car and other transport expenses
- Accommodation and meal expenses
- Interest on borrowings
Expenses that you can’t claim
You won’t be able to claim the following expenses in regard to your self-education:
- Tuition fees paid by someone else or that a third party reimburses you for
- Tuition fees paid upfront or with the help of a HECS-HELP loan for Commonwealth supported places at a university or higher education provider
- Repayments of study and training support loans such as:
- Higher Education Loan Program, including FEE-HELP and HECS-HELP.
- Student Financial Supplement Scheme
- VET Student Loans (VSL)
- Student start-up loans and former ABSTUDY Student Start-up Loans; Australian Apprenticeship Support Loans (AASL)
- Accommodation and meals where you don’t need to be temporarily away from home for one or more nights.
You also won’t be able to claim a deduction for self-education expenses you incur if your only income is a qualifying Australian Government Allowance or Payment. This allowance or payment is eligible for the beneficiary tax offset. For self-education expenses you incurred prior to 1 July 2022, you won’t be able to claim the first $250 of expenses.
Apportioning expenses
If you incur an expense for personal purposes and work-related self-education, you can only claim expenses incurred for work-related self-education. This simply means you need to apportion the expense. If the self-education is not connected to your current employment income overall, but specific subjects of a qualification or components of a course are, you can claim a deduction for the cost of those subjects or components. You can claim a deduction if the components or subjects have enough connection to your employment activities when you incur the expense, and you can work out their cost. If you find difficulty apportioning expenses, you can seek help from the best accountant in Melbourne.
Keep accurate records for self-education expenses
You need to maintain written evidence for incurred self-education expenses, including:
- Course fees
- Text books
- Stationery
- Depreciating assets such as laptops, computers, and office equipment
- Transport expenses
- Travel expenses, unless an exception applies.
You also have to explain how the course directly relates to your employment activities when a self-education expense is incurred.