Cap on work-related self-education deductions

The Treasurer has announced that the Government will introduce a $2,000 per-person cap on tax deduction claims for work-related self-education expenses. The cap is proposed to apply from 1 July 2014. The announcement was made “as part of a package of reforms to make a down-payment on the National Plan for School Improvement”.

Mr Swan said that without a cap, “it’s possible to make large claims for expenses such as first class airfares, 5-star accommodation and expensive courses”. However, Mr Swan said “the majority of those with self-education expenses will not be affected by this change”. He said the Government “will consult closely with employees and employers to better target this concession while still supporting essential training”.

Further, Mr Swan said the Government will retain the current treatment under which employers are not liable to fringe benefits tax (FBT) for education and training they provide to their employees, unless an employee salary sacrifices to obtain those benefits.

Source: Treasurer’s media release No 048, 13 April 2013, www.treasurer.gov.au/wmsDisplayDocs.aspx?doc=pressreleases/2013/048.htm&PageID=003&min=wms&Year=&DocType=0.