Deductions against government assistance payments are no longer available

In the 2011-12 Budget the government announced that it would make changes to disallow deductions against government payments.

On 27 June 2012 these changes came into effect when the legislation received royal assent. The new law is effective 1 July 2011 and expenses that relate to meeting the ongoing requirements to receive certain government assistance payments can not be claimed as a deduction.

Government assistance payments that are no longer eligible for deductions include:

  • Austudy
  • ABSTUDY
  • Newstart Allowance

This brings the long fight by the ATO against deductions from student allowances to an end. The ATO lost the court cases so the government chnaged the last. See http://thomsonhall.com.au/wordpress/tag/education/ for ealier parts of this story.