Are post grad education fees/interest deductible?

Kahuna_2

Hi all,

I have trawled though about 30 pages of threads to try and find an answer, so please excuse me if a similar question has been asked before.

Last year my girlfriend left teaching to do a masters degree in Educational Psychology. The fees for this were over £10k and she had to take out a career development loan. She is now employed as an EP and would like to know if the fees and interest on the loan are deductible from her taxable income?

Thanks in advance for any help.

WHA

No, they're not an allowable deduction

Robert_Sterling

They are not deductable because it is considered to be the case that you choose to study to improve your value in the market place.

Petmidget

Interesting one this.

Fees, no chance I am afraid. Its personal development and reflected in your current and future higher earning potential.

The interest on the loan though, it would be wrong of me to say yes but it could be worth a try. You might get a proportion of it.

The qualification is necessary for the job, the loan necessary to obtain the qualification. You could therefore argue that the expense (interest) on the loan is "wholly, exclusively & necessary" for the employment and therefore deductable under section 249 of ICTA 1988.

Chance your arm making a claim under "interest for a qualifying purpose" on the Employment section of your Tax Return. I would not suggest asking the question of IR as they will just say no rather than doign any detailed research. Fill out a tax return and let them come to you.

Kahuna_2

Thanks for your replies everyone, even though it is not the response we wanted! Seems strange that some educational fees (e.g. accountancy qualifications) are allowable and others not.

WHA

Kahuna wrote:

Thanks for your replies everyone, even though it is not the response we wanted! Seems strange that some educational fees (e.g. accountancy qualifications) are allowable and others not.

I don't think any educational fees are allowable for an employee. Relevant subscriptions to professional bodies are allowable for employees and self employed. If you are self employed, training courses etc to improve your knowledge in the same trade/profession would be allowable. But as far as I know, the actual costs of educating yourself in any trade/profession or vocation are not allowable.

amcluesent

I've asked the Open University about this, and they've said no tax deductions for someone on PAYE.

Kahuna_2

If education is not an allowable for an employee, then the employer pays for education shouldn't the fees be counted as a benefit in kind for the employee and then included on the P11d? Or am I applying logic where I have no business to do so?!?!?

You'd think that the government would try to encourage personal development by allowing fees as a deduction.

Thanks again.
K.