What is the education tax refund?
Thursday, July 2nd, 2009The education tax refund (ETR) is a new refundable tax offset set up to help with the cost of educating primary and secondary school children - and as part of PM Rudd’s initiative towards every Australian school child having a computer.
It means that eligible parents, carers, legal guardians and independent students could get 50% back on some education expenses. This includes items like:
- Computers and computer-related equipment
- Educational software
- Home internet connection
- Textbooks
- Stationery.
In general, you can claim the education tax refund if you are eligible for Centrelink’s Family Tax Benefit (FTB) Part A, although in some cases even if you do not get this the child may be eligible for the education tax refund.
How it works
You claim 50% of education expenses up to a maximum of $750 for each primary school child and $1,500 for each secondary school child you have. 50% means that you can claim $375 and $750 respectively.
For example: Your daughter goes to secondary school. You bought her a laptop for school. It cost $1,200.
- 50% of the expense is $600. Thus you can claim $600 for the 2008/09 tax year
Normally there would be other expenses as well. For example, you probably bought software for the laptop, plus there’s the internet connection (or a portion of it, anyway), lots of textbooks, stationery and so on. Suppose your daughter’s expenses actually come to $2,500.
- In this case, you can only claim the maximum of $1,500
- Thus your entitlement would be $750 for this year
- The excess $1000 could be carried over towards the following years expenses
If you share custody of a child, you can claim a percentage for the time your child is with you.
How do I claim?
You can claim it on your tax return, or if you don’t have to complete a tax return, then you can use the special Education Tax Refund Claim form from the ATO. You can post this to the tax office or lodge over the phone by ringing 13 28 65 and following the prompts.
If you have both a baby bonus claim and an Education Tax Refund (ETR) claim you cannot lodge via the phone. You can then lodge via e-tax or post both the baby bonus form and the ETR form in together.
As always, remember to keep receipts for everything you claim. You may have to prove your expenses at some time. The claim needs to be treated as a tax return, hence everything needs to be kept for the required 5 years.
I want to know more
The ATO has lots of good information about it on their Education Tax Refund web site, including a great little fact sheet.