07 May Tribunal rejects claims for self-education expenditure

The Administrative Review Tribunal recently rejected an employee’s claims for self-education expenses, as they did not have a sufficient nexus with his current job and income-earning activities.

The taxpayer worked as an employee for a large company.  He claimed that his role evolved to include marketing and sales responsibilities during the 2022 income year, and that he was required to take courses in sales and marketing to help him perform his role.

The taxpayer sought to amend his tax return for the 2022 income year by claiming additional deductions for expenditure on online educational and training courses, related computer software and hardware, and membership fees.

The ATO disallowed these deductions, and the Tribunal affirmed the ATO’s decision.  The Tribunal noted that there was nothing in writing from the taxpayer’s employer requiring him to undertake sales and marketing activities, let alone take self-education courses in those areas.

The expenditure incurred by the taxpayer related to online content creation, affiliate marketing, and entrepreneurship, whereas the taxpayer’s work related to providing technical IT and computer services.  Therefore, the expenditure did not bear a sufficient nexus with the taxpayer’s income-earning activities for it to be deductible.