Get the latest information surrounding self-education expenses (item D4 of the tax return), especially in relation to the recent changes made to deductibility rules. We’ll also cover off some key information about what can and cannot be claimed and at what stage a legitimate claim can be made.

Items that can be claimed

Typical expenses that can be claimed as a tax deduction in personal tax returns include the following: tuition fees (direct full-course fees, fees payable under FEE-HELP, fees payable under VET student loans, and costs under OS-HELP loans), meals and accommodation during temporary overnight stays to participate in a course, textbooks, stationery, union fees, amenities fees, parking fees, a proportion of the decline in value of a computer, and travel costs in either direction between home and place of education or workplace and place of education. Note that with travel costs, only one leg of the trip is tax deductible.

Items that cannot be claimed

Fees paid under the HECS-HELP, HELP, SFSS, SSL, TSL or VSL programs cannot be claimed. Additional legs of trips made between home, work and place of education cannot be claimed.

Further, any formal courses provided by professional associations, or seminars, workshops or conferences cannot be claimed as part of self-education expenses. These are, however, tax deductible but claimable at Other Work-Related Expenses (item D5 of the tax return).

Timing of claimable deductions

In order to claim self-education expenses, you must be working in that same industry and show that the course undertaken was leading to, or would likely lead to an increase in income from those current work activities. You cannot claim self-education expenses if you undertake a course to obtain a job in the future in that industry, or if you’re looking to move into a different area of specialty in your current industry. Should this be satisfied, all items that can be claimed (as listed above) will be deductible expenses.

The removal of the $250 reduction

Commencing from the 2023 financial year, the ATO have removed the requirement to reduce the first $250 of self-education expenses. This simply means that for every deductible amount claimed, the tax benefit for claiming self-education expenses commences from the first dollar of claimable costs – in line with other work-related deductions.

Conclusion

The above is a summary of the claiming of self-education expenses as a tax deduction for individual taxpayers. It outlines key items that can be claimed, at what stage they can be claimed and the key change that took place in the 2023 financial year which removed a reduction in the claimable amount by $250.