Tax

Homework pays … back-to-school costs can be a burden but tax relief is available. Photo: Dean Osland

The strategy: To gain a tax break on all that money I've just laid out on back-to-school expenses.

Can I do that? You certainly can. The education tax refund gives you back up to $409 for every primary school-age child in your care and $818 for children of secondary-school age. For the average family with a couple of kids, that can ease quite a bit of the pain of those back-to-school expenses.

How does this refund work? It's actually a refundable tax offset, which means it will reduce the amount of tax you have to pay if you have a tax liability and any ''unused'' amount will be paid out to you as a tax refund. You'll need to keep receipts for eligible education expenses and you can claim a refund of up to 50 per cent of these expenses in your next tax return.

So if you spent, say, $1000 kitting your child out to start high school, you can claim a tax refund of $500. To obtain the full refund you'll need to spend $818 for a child of primary-school age and $1636 for a child in secondary school.

If you had two children, one in primary school and one in high school, you could claim a refund of up to $1227. The refund is indexed each year.

To be eligible, however, you must qualify for Family Tax Benefit Part A (or have received a payment such as Youth Allowance or Disability Support that prevented you from gaining the benefit). Independent students are also eligible.

The refund covers a wide range of eligible education expenses, including money spent on textbooks and learning materials, computers, software, home internet connections, prescribed trade tools for secondary-school trade courses, as well as equipment such as printers and flash drives. You can also now claim the cost of school uniforms bought from July 1 last year.

However, you can't claim school fees or extracurricular costs such as tutoring, sporting equipment, excursions and camps, school subject levies (such as payment for consumable items used in subjects such as home science and woodwork), library fees, school photos and musical instruments.

If I have more than one child and they share items such as the computer and internet connection, can I claim the full cost for both of them? The rules allow for expenses to be ''pooled'' between children where they both (or all) use the items concerned. So a home computer, printer and internet connection shared by two or more children can be claimed on this basis. If you still spend more than the limit, the extra can be carried forward and claimed in next year's tax return, provided you and your children are still eligible for the refund.

What happens if my child started or left school this year? The Tax Office says you can claim the refund for the part of the year your child was eligible. So if, for example, your child finished school before Christmas and has just started work or uni, you can claim the refund for half the year - a maximum refund of $409. To be eligible, the child has to have attended primary or secondary school or received home-schooling for at least one day in a six-month period, starting July 1 or January 1. If your child has just moved up to high school, you can claim the higher refund for the full year.

Can I obtain the refund if I don't have to do a tax return? There is an education tax refund form that can be used if you don't need to lodge a tax return. However, you will still need to keep your receipts to justify what you've claimed if the Tax Office decides to ask questions. More information is available at: www.educationtaxrefund.gov.au.

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