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MeinAus(Newbie)Newbie
6 June 2022

Hi,


I was an international student from 2018-2019 pursuing a Masters degree. I had taken an education loan to pay for my tuition fees during this time which is repayable over 10 years.

I did not work during this time. I got a job as a graduate analyst in an IT company starting from March 2020 after I graduated, which is directly related to my Masters degree.


Once I started earning, I have paid almost $14,000 (combining FY 2020 and FY 2021) as interest towards my education loan.


Could you please let me know if I am eligible to claim this interest expense in my tax deductions. If yes, would I need to amend previous years tax returns to include this expense.


Thanks!

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2,976 views
4 replies

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Most helpful replyATO Certified Response

EthanATO(Community Support)Community Support
ATO Certified Response6 June 2022

Hi @MeinAus,


Unfortunately, no you wouldn't be able to claim this as a deduction. To be able to claim self-education expenses as a deduction you need to meet a couple of things. At the time of taking the course it needs to have sufficient connection to your current employment activities (at that time) as an employee and either:

  • maintains or improves the specific skills or knowledge you require in your current employment activities,
  • results in, or is likely to result in, an increase in income from your current employment activities.

The main issue is that you finished the master's degree, and then started working in the field. This means the course expenses don't meet the sufficient connection as when you incurred the expenses they didn't have a connection to your employment.

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Most helpful replyATO Certified Response

EthanATO(Community Support)Community Support
ATO Certified Response6 June 2022

Hi @MeinAus,


Unfortunately, no you wouldn't be able to claim this as a deduction. To be able to claim self-education expenses as a deduction you need to meet a couple of things. At the time of taking the course it needs to have sufficient connection to your current employment activities (at that time) as an employee and either:

  • maintains or improves the specific skills or knowledge you require in your current employment activities,
  • results in, or is likely to result in, an increase in income from your current employment activities.

The main issue is that you finished the master's degree, and then started working in the field. This means the course expenses don't meet the sufficient connection as when you incurred the expenses they didn't have a connection to your employment.

MeinAus(Newbie)Newbie
9 June 2022

Thanks @EthanATO!

Just to add to my query, I got my offer letter for my position while I was in Uni and to maintain that employment offer I had to take up specific courses related to my job and had to complete my Masters. Could you please let me know if this makes claiming deductions in this category eligible?

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