Self Education Expenses Essay Example | Topics and Well Written Essays - 2500 words

Self Education Expenses - Essay Example Her assert for a deduction is consequently restrained to the first branch of s 8-1(1) which allows loss or outgoing deductible to the extent that; It is adequate if the claimed expending is made "in the course of" gaining or giving rise to the taxpayer's measurable income (Ronpibon Tin NL v Federal Commissioner of Taxation) (www.taxmatrix.com.au) In the present case also it was proved that, what was creative of computable income was the Taxpayer's qualification to receive the Youth Allowance and having continued that qualification all through the appropriate period by fulfilling the activity test. The agreement of that trial, in turn, necessitated her to be entered in a course of education at an educational institution, to be taking on at least three-quarters of the usual amount of full-time study in value of the pertinent course for the period in question and to allow the Secretary to form the judgment that she was making acceptable progress for finishing the course. Actually in the present case, the taxpayer was not employed as a teacher nor was she employed in any other applicable capacity. These expenses were met by her in the course of qualifying for a Teacher's Higher Certificate. The tribunal stated that the applicant was required to be enrolled and make progress in full time study so that she is entitled to receive Youth Allowance. Under such circumstances the costs which she incurred in the course of her studies were allowable as a deduction. The fact that the applicant was enrolled at the Australian Catholic University was "a course of education at an educational institution" pursuant to s541B(5) of the SSA was agreed. The Federal court allowed the expenses in the present case to be deductible on the following grounds: (www.taxmatrix.com.au): a. Such expenditure was supplementary or essential to her gaining Youth Allowance. b. The Commonwealth was paying the taxpayer the Youth Allowance since she was a student; not for studying per se. c. The indispensable character of the taxpayer's expenditure lay in it been incurred in taking on her studies so as to allow her to discharge her course of study and acquire successive employment as a teacher; and d. The expenses were related to or supplementary to the taxpayer's course of study and not to the benefiting or getting of Youth Allowance income. 2. As the ATO is considering whether to appeal this decision, what legal arguments can it put forward in support of such an appeal Critically analyze whether you think these arguments will succeed if the decision is appealed. [Approx 1,000 words] Self education expenses to derive Youth Allowance income is an allowable deduction as ruled in the case of Anstis v FCT. The federal court had held that self education expenditure can be claimed by a taxpayer as deductible expenses. But such expenses had to be incurred as a necessity and also derived as an incident of computable income. In the case mentioned supra the assessable income was the Youth Allowance. In the present case the assessee claimed for a deduction of $920.00 for work-related self-education expenses. The law of Australia lays down that a taxpayer can claim deduction of self education