Textbook Tax Deduction Query

Posted On: Thursday, October 11, 2018

QUESTION

I am enrolled as a full-time master’s student at Melbourne Uni. I receive a tax-free graduate research stipend. The role is part of a training program, so I can qualify as a veterinary pathology specialist, and I teach, perform research and also perform diagnostic duties as part of the role. I recently submitted my tax return and claimed $2000 in veterinary textbooks that I purchased that are directly related to performing my role at Uni and will also aid in completion of my specialist examinations. Are these not tax deductible? My tax return has been “delayed”.

I started this role in January and prior to this was working as a veterinarian (and paying tax).

Answer

The fundamental test for deductibility is... was the expense incurred in earning assessable income?

As this research stipend is not assessable... the ATO may fairly take the view that expenditure is not a tax deduction.

Did you have any assessable income for the year ended 30 June 2018 and could it be argued that the expenditure (at least in part) related to this income?

Also, there is the possibility of some of this expenditure being self-education expenses.

All this would depend on what disclosures you have already made to the ATO.

 

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