Thursday, November 11, 2010

Youth Allowance Tax Claims

But the High Court has found youth allowance payments are "ordinary income" and that the student's expenses were incurred in earning that income. 

Tricky one this one. Youth Allowance for tertiary education is awarded to students who are undertaking a course which ought to lead to independent income generation and the course materials are expensive so it would be helpful to have those claimed under the income tax laws. Paying course fees and then for materials on top of that is a very big financial outlay these days.For those on small budgets then everything helps and being a full time student is a job so I can see that the allowance paid can be seen as income for doing that job. I can also see that the tax office would be thinking it is a contribution to overall family income to help families support students and then helpful to students living away from home as a way of helping themselves. Income support rather than income. So I guess the government will have to be careful how it distributes the income and that those earning it are actually working for it and being at their place of work as any other income earner. In that sense it would be perhaps necessary to "employ" students at their place of work and have someone there in charge of the payroll and clocking in and out! In a normal workplace, who is responsible for knowing who is at work, who is not at work and who is doing their job? Every work place ensures people are on the job. Somehow we never think that way for education and training and yet it it is now deemed as income, maybe it should be like that.

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