Tax tips for students

Ask any tertiary student, and they will tell you that they accumulate plenty of study-related expenses throughout the year. With tax time upon us, which of those expenses can you claim as a tax deduction?

We’ve spoken to the Australian Taxation Office (ATO) about what work-related self-education expenses a university student can claim.

Please note: The following information is not to be taken as taxation advice. Please consult a taxation advisor for all tax-related matters.

When it comes to working out whether an expense is tax deductible, there are three things you need to consider:

1. Have you spent the money yourself and not been reimbursed?
2. Is the expense directly related to earning your income?
3. Do you have a record to prove the expense (usually a receipt)?

If you answer ‘yes’ to all of the above, then the expense is most likely tax deductible. Keep in mind that if the expense was for both work and private purposes, you can only claim a deduction for the work-related portion.

The ATO won’t allow deductions if your education is not directly related to your current work activities as an employee. To claim self-education expenses the course must meet one of the following criteria:

• It maintains or improves the specific knowledge or skills you require for your current job.
• It will result in or is likely to result in an increase in your income within your current employment.
• You’re employed as a trainee, and you are undertaking a course that forms part of that traineeship – for example, an overseas trained person employed as an intern while doing a bridging course.

What You Can Claim

If you meet one of the above criteria, there are a range of tax deductions you can claim in association with completing your work-related study. Some common deductions include:

• Course/tuition fees (if paid directly by you)
• Student service fees
• Student union fees
• Stationery
• Textbooks
• Decline in value for depreciating assets that cost more than $300 and repairs to those depreciating assets (e.g. laptop, printer, etc)
• Amenity fees
• Direct travel from your home or workplace to your place of education

What You Can’t Claim

Even if related to your study, there are some expenses that you can’t claim including: HECS/HELP fees and repayments, home office occupancy expenses (such as rent, home and contents insurance, rates, mortgage interest) and financial supplement loan repayments.

Things To Keep In Mind

In certain circumstances you will need to reduce your allowable self-education expenses by $250. If your expenses for the year only include fees, textbooks, stationery and travel, you will need to deduct $250 from your total before adding it to your tax return. For more information about when you need to reduce your claim refer to Education and study. You can also use the ATO’s Self-education expenses calculator to calculate your claim.

If you receive Austudy, enquire about your tax situation at the beginning of the financial year rather than waiting until tax time. Ask Centrelink about your Government allowances to make sure you don’t owe any tax at the end of the financial year.

If In Doubt, Ask For Help

Do you know every study-related expense that you’re entitled to claim? Our complicated taxation system includes lots of rules about what you can and can’t claim. That’s why  about 70% of Australians use an agent when preparing their tax return, according to ATO figures.

Often, your tax agent can suggest deductions you might not otherwise know about. This is important, because extra deductions could mean that you receive a larger refund at tax time. Not to mention the peace of mind this could bring, knowing that you haven’t accidentally broken any taxation laws.

This article was originally published in June 2019 and updated in April 2021.