Tax time - Self Education expenses... again.
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Tax time - Self Education expenses... again.
Briefly. Back in March I was offered a job and accepted it. One condition was that I pay for my own Baron endo and the company would pay for the other twin endo. So did this expense
or was it an expense which simply
???
If I'd started the job and then done the endo on the first weekend then there'd be no question. However I needed to move cities and decided to do it before the move
.
Thanks in advance,
FRQ CB
Quotes are from the ATO's 2009 e-tax Help File.
have sufficient connection to your current employment, that is, the course:
■
maintains or improves the specific skills or knowledge you require in your current employment, or
■
results in, or is likely to result in, an increase in your income from your current employment.
■
maintains or improves the specific skills or knowledge you require in your current employment, or
■
results in, or is likely to result in, an increase in your income from your current employment.
enables you to get new employment.
If I'd started the job and then done the endo on the first weekend then there'd be no question. However I needed to move cities and decided to do it before the move
.Thanks in advance,
FRQ CB
Quotes are from the ATO's 2009 e-tax Help File.
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To claim or not to claim?
FRQ,
I think you will find that the test the Commissioner applies is that of whether you are already employed when you further increased your skill (in this case, the Baron endo).
In both cases, the test of whether the expense is deductible, refers to current employment. Unfortunately, (and someone with a greater knowledge of tax may correct me), as you were not wilfully employed at the time of the endo, you are ineligible to claim the expense.. i.e. you needed the endo to get the job.
If you already had the job and needed the endo to progress in the company, i.e from singles to twins, then it would be classified as a deductible expense.
S
I think you will find that the test the Commissioner applies is that of whether you are already employed when you further increased your skill (in this case, the Baron endo).
In both cases, the test of whether the expense is deductible, refers to current employment. Unfortunately, (and someone with a greater knowledge of tax may correct me), as you were not wilfully employed at the time of the endo, you are ineligible to claim the expense.. i.e. you needed the endo to get the job.
If you already had the job and needed the endo to progress in the company, i.e from singles to twins, then it would be classified as a deductible expense.
S
Join Date: Oct 2008
Location: Brisbane, Qld
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sounds about right. why don't you jump on the phone and ask the ATO? (no kidding...they're actually quite helpful). 
they may or may not help but worth a shot direct from the 'horses mouth'.
they may or may not help but worth a shot direct from the 'horses mouth'.
Make the claim, take the money. People have been claiming their 737 endorsements for years. If you read the Tax law, you are not entitled to the claim and if you ask the ATO, they will more than likely take that line as they are in the business of taking your money, not returning it. Once you have a ruling, you are finished. If you make the claim and at some time in the future the ATO rules that it is not legitimate, you will be able to justify why you disagree. At the worst, you will have to pay back what you saved plus interest but no penalty would be applied as you believed that the claim was legitimate and can back that up. There may have been a test case with a Virgin Pilot claiming the cost of his 737 endorsement even though he was not employed by Virgin when he undertook it. I am not sure but if there was no test case, I can't see why the ATO would allow this practice to continue but they do. The AFAP should know.
