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Can I deduct the cost of education or courses from my tax return?

Shirley Liu
Shirley Liu

Updated

If you’ve taken a course to benefit your career or to sharpen your work skills then you might be able to deduct the cost from your tax return, but there are some stipulations. Read on for the full story.

When it comes to claiming the cost of an educational course, the Australian Tax Office (ATO) in its own words says that:

“Work-related self-education expenses are expenses you incur when you undertake a course to obtain a formal qualification from a school, college, university or other place of education that is relevant for your current employment.”

So you have to be able to prove that the course you have taken was intended to directly benefit your career. So, if you’re an investment banker and you took a flower arranging course, it’s likely that you won’t get away with deducting that. But if you’ve legitimately taken a course to further your career, then you should find some relief in your tax return.

Quick Links:

See our latest June 2020 online courses that costs over $1,000:

What expenses can I claim?

Anyone who has ever taken a course will know that there is a lot more to education than paying for tuition. In fact, it can often surprise people by just how much extra there is to cover. Again, we’ll give you the expenses available as told by the ATO. Expenses that can be claimed include:

  • Accommodation and meals (if away from home overnight)
  • Computer consumables
  • Course fees
  • Decline in value for depreciating assets (cost exceeds $300)
  • Purchase of equipment or technical instruments costing less than $300
  • Equipment repairs
  • Fares
  • Home office running costs
  • Interest
  • Internet usage (excluding connection fees)
  • Parking fees (only for work-related claims)
  • Phone calls
  • Postage
  • Stationery
  • Student union fees
  • Student services and amenities fees
  • Textbooks
  • Trade, professional, or academic journals
  • Travel to-and-from place of education
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What expenses can’t I claim?

Sadly, not everything can be claimed, and there are limits on some expenses. Things that cannot be claimed include:

  • Repayments of Higher Education Loan Program (HELP) loans: HECS-Help, FEE-Help, OS-Help, VET FEE-Help and SA-Help
  • Student Financial Supplement Scheme (SFSS) repayments
  • Home office occupancy expenses
  • Meals - where not sleeping away from home
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What is the $250 reduction?

In some cases, the ATO states that the first $250 of self education costs are non-deductible. However, there are some expenses which are not allowed as a deduction, that can be offset against the $250 before you have to reduce the amount you can claim for expenses. This may include:

  • Child care costs
  • Computer purchases
  • Travel expenses or car expenses
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Where can I go for help?

There is no getting away from it, tax can be confusing. If you’re struggling to get your head around this, then perhaps you might benefit from getting some professional help with your taxes. There are a whole host of services available in Australia with a host of fees and methods of working. Have a look through our full guide to tax services by clicking on the link below.

Click here for our guide to tax providers (you’ll see them listed on the left hand side).

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Where can I find an online course?

If you’re looking for an online course, then you’re in luck. We’ve reviewed the best online courses available in Australia. Follow the link below to see the best courses available online.

Click here for our full preview of the best online courses available.

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