Hi all
if you haven't realised it yet, its almost 30 June which means its 'that time' again where we have to prepare income tax returns. Given most of the users on here are active pilots, you're probably wondering what to do.
I highly recommend that you read
TR 95/19 Income tax: airline industry employees - allowances, reimbursements and work-related deductions which is the official ATO guide as to what you can and can't claim as a tax deduction. The actual URL is (
TR 95/19 - Income tax: airline industry employees - allowances, reimbursements and work-related deductions (As at 5 June 1996)).
Specific things to note:
1. you can claim work-related expenses under $300 without the need for substantiation. However should you claim >$300, you will need to keep receipts, etc to substantiate the FULL amount. This is defined in the Tax Ruling above.
2. Self education expenses - pasted below:
109. A comprehensive explanation of the deductibility of self education expenses is contained in
Taxation Ruling TR 92/8. Key points include:
(a) A deduction is allowable for self education expenses if the education is
directly relevant to the taxpayer's current income-earning activities. This particularly applies if an airline employee's income-earning activities are based on skill/knowledge and the education enables him or her to
maintain or improve that skill/knowledge.
I've bolded (is this even a word??) and underlined the key points above, especially for the up and coming pilots who are thinking of claiming their initial ME/CIR costs. I believe you should be able to claim your renewals, but not your initial.
(b) A deduction is allowable if the education is likely to lead to an increase in the airline employee's income from his or her current income-earning activities.
(c) A deduction is not allowable if the education is designed to enable an airline employee to get employment, to obtain new employment or to open up a new income-earning activity (
FC of T v. Maddalena 71 ATC 4161; 2 ATR 541).
(d) Self education includes courses undertaken at an educational institution (whether leading to a formal qualification or not), attendance at work-related conferences or seminars, self-paced learning and study tours.
(e) Self education expenses include fees, travel expenses (e.g., attending a conference interstate), transport costs, books and equipment.
Happy reading. Perhaps others who have lodged tax returns in the past and have tips can post here. Remember, when in doubt either talk to an accountant or call up the ATO directly. DO NOT claim the deduction and hope for the best unless you're sure as you'll be liable for penalties and interest.
Cheers
Pharoah