Students return to study - and a larger tax bill

Monday, 6 February 2012  Media Alerts

A senior academic from the Australian School of Business is available for comment on the changes to taxation law. The modification was announced in the 2011 Federal Government budget announcements, however the latest draft legislation has only just been presented in Canberra, before entered a period during which anyone can make submissions.

Dale Boccabella, an Associate Professor of Taxation Law at the Australian School of Business says "many students will certainly want to comment, however at this stage it looks highly likely the tax law will be amended to specifically disallow a tax deduction for self-education expenses against the receipt of government assistance payments. This follows on from a High Court case where a university student took the Australian Taxation Office all the way through the courts and won the right to claim a $900 tax deduction for self education expenses against the receipt of Youth Allowance."
"This is likely to have quite an impact on some students, because the ATO definition of self-education expenses was quite broad," he says. "It was: costs you incur in undertaking a course of study at university, college, school or recognised place of education'. Generally, for an expense to qualify as a self-education work related expense there had to be a connection between a student's current job and the course they were studying."

Associate Professor Boccabella says "from now on students will no longer be able to claim for textbooks, stationery, tuition fees (excluding HECS-HELP debt), travel, home study expenses such as the internet, or depreciation expenses on assets such as computers, laptops, or even furniture. A perception that it may be unfair to some students is largely behind the decision, and while it may be a surprise to some, it has been forecast for some time. While some students may be hit hard, but if you average it out, the lost tax benefit to each taxpayer because of the government's decision is minimal: in effect only around $150 per year."

For comment please contact Dale Boccabella on 02 9385 3365 or 02 9874 2539 or d.boccabella@unsw.edu.au.

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