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Doing a course for work? Here’s what you need to know about recent Government changes

by Yvette Maurice

There are some big changes coming for those who intend to undertake courses or formal training as part of their job. The government announced some big moves in the most recent Budget.

The changes to work-related education expenses

  • Deductions for work-related education expenses will soon be capped at $2,000. This will be put in effect from July 1, 2014. The measure is aimed at saving the government $514.3 million over the forward estimates.
  • There will also be a lower limit on tax deductibility for self-education courses. This measure will save the government a cool $500 million.
  • Also, currently employers are not liable for fringe benefits tax for education and training they provide to their employees – this treatment will be retained, unless an employee salary sacrifices to obtain these benefits.

Treasurer Wayne Swan has said, “The government values the investments people make in their own skills and the benefits of a tax deduction for work-related self-education expenses.” However, these new policies do not seem to support that and the fact that employers are not liable for fringe benefits taxes for education and training for their employees further demonstrates that our government isn’t showing recognition of the fact that employers want to invest in the skills of their workers.

What does this mean for you?

Are you thinking of investing in education and training courses in order to up-skill or improve your career prospects? This could include skill builder courses, programs to train yourself on new technologies and equipment and even undertaking a Certificate or Diploma course in an area related to your job, for example a Certificate IV in Training and Assessment or a Certificate IV in Bookkeeping .

If so, then from the 1st of July 2014, any education expenses you plan to claim on tax will be capped at $2000. Despite the ATO data stating “the typical claim for formal qualifications is less than half the proposed cap at $905,” many potential students have found that quality, comprehensive courses cost far more than that, particularly if the student needs to undertake more than one in a year.

Please refer to the Australian Tax Office for more information.

By enrolling now with Open Colleges, students can avoid the cap. Many Open Colleges courses can be completed in less than 12 months, due to their self-paced nature. In fact, by enrolling before 30th of June 2013 you could save a substantial amount on your course fee.

The message is clear: if you are interested in undertaking training and education as part of your job, you need to enrol now to make the most of your potential deductions.


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