Flight training and the tax office

[Clare Prop]

A clear nexus must be present between the "expense" and the taxpayer's income earned from their current place of employment.

• The Commissioner will allow for a deduction for self-education if the current employment by which the employee undertakes is based on that of a skill or specific knowledge that self-education will either maintain or improve. For example, a hospitality management course undertaken by a restaurant manager will be deductable as it improves their direct skills and expertise in carrying out their profession.
• If it is likely that the self-education will lead to an increase in income within their current income-earning activity, a deduction will be allowed. If an individual has an agreement with their employer that if they undertake a self-education course and they will receive a promotion upon completion, then the conditions for a deduction will be satisfied.
• One of the more crucial distinctions is that a deduction will be denied if the self-education undertaken is designed to get employment, gain new employment, or opens up a new income-earning activity. As discussed in respect to Khan’s case, even if the course of study relates to the two points above, if the individual is unemployed at any time, then the deduction may be denied.

Self-education expenses | RSM Australia