The Education Tax Refund The Education Tax Refund ('ETR') was announced in the 08-09 federal budget. Under the ETR, families can claim up to a 50% tax refund for eligible education expenses for their children, for up to:
- $750 for each child in primary school, and
- $1,500 for each child in secondary school
These amounts equate to a maximum tax offset of $375 and $750 respectively. It is a good idea to be aware of this scheme, as parents can now claim for allowable expenses related to their children's education. Some common allowable expenses include: laptops, desktop computers, education software, school textbooks, trade tools etc. So be sure to keep those receipts, as every dollar spent (up to the limits above) could be worth up to a 50c tax refund for your family.
Eligibility The ETR is available to families receiving the Family Tax Benefit Part A (FTB Part A). The FTB Part A is a separate existing tax benefit which is given by the Family Assistance Office as fortnightly payments to families that meet the Income Test. We won't go into all the rules regarding qualifying for the FTB Part A, but basically families that have a total family income of less than a certain threshold will receive this tax benefit. In the 08-09 year, this limit was $98,514 (for families with under 18 dependants) or $99,962 for families with some dependants over 18. Add $3,796 to the respective limit for each additional child. So basically if your family income was less than this limit, you would be eligible for the FTB Part A, and hence the ETR (whether you currently receive the FTB is irrelevant, your family just needs to be eligible for it).
Additionally, for the purposes of the ETR, any income in the form of youth allowance, disability support or ABSTUDY (there are a few others) do not count to this limit. So if your family income falls under the threshold for the FTB Part A but for those payments in respect of your child, you're still eligible for the ETR.
Allowable expenses
Generally, all expenses that (in the words of the federal government) "support a child during school and improve quality of education" are allowable. For example:
- Laptops & home computers and associated costs (including repair and running costs of computer equipment and lease costs), home Internet connection and printers and paper
- Education software
- School textbooks and material (including prescribed textbooks, associated learning materials, study guides and stationery)
- Prescribed trade tools
The list above is not exhaustive, but give you an idea of what are allowable expenses.
Notice that all school textbooks and materials are allowable. For example, you or your child may have purchased HSC textbooks, or prescribed texts for HSC English - claim those! Your family internet connection is also claimable. Just remember to keep your receipts. If you buy claimable goods second hand from private sellers, request a receipt (a simple note noting the goods / service, the price and date will suffice).
However, tuition costs (such as payments to Dux College or other HSC tuition colleges) and school fees are not allowable expenses. Nor are non-education related software such as computer games, or hardware used for such purposes, obviously.
How to claim
The ETR is claimed when parents complete their annual tax return. For those using the e-Tax software, there will be a section for the ETR. Just remember to keep those receipts!