Self-education tax deductions: Are you eligible?

Continuous learning is a key to professional development, and studying an online course helps you build on skills and knowledge that can progress your career. But did you know that you can claim tax deductions if your online course is work-related? As we are nearing the end of the financial year, it’s a good time to find out if you’re eligible for self-education tax deductions.

Are you eligible?

The Australian tax law for self-education allows you to lodge a claim for a tax deduction for courses you’ve studied. In this case, if you studied and paid for your courses during the financial year 2017/18. This means that you can deduct the cost of your self-education expenses like internet usage, home office running costs, and decline in value of depreciating assets like the computer you used for studying. Keep in mind that only courses that are sufficiently connected to your current employment are eligible for a work-related tax deduction.

For example, you’ve just been promoted as team leader in your organisation and would like to be skilled and effective for this role. You then enrol in the Diploma of Leadership and Management online to develop your skills for the job. The expenses or cost of studying this online course may be claimed as work-related tax deductions.

Here are conditions specified by the Australia Taxation Office (ATO):

  • You upgrade your qualifications for your current employment
  • You improve the specific skills and knowledge required in your current job
  • Gain a qualification that will result, or is likely to result, in an increase in your salary or employment income from your current job.

For further information, refer to the ATO website: https://www.ato.gov.au/Individuals/Income-and-deductions/Deductions-you-can-claim/Self-education-expenses/

Important

1. Keep detailed records of your expenses and keep a copy of your receipts.

2. If an expense is partly related to your self-education and partly for other purposes, you may only claim the amount that relates to your self-education as tax deduction.

3. You are not eligible for self-education tax deductions if your course might only be generally related to your work or if it enables you to get new employment.

4. To get help on claiming deductions on your tax return, consult with an accountant or registered tax professional.

If you haven’t started a course yet, plan and start today!

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