When are course fees tax deductible?

A sole trader plumber and would like to attend a refresher course to reinforce the skills he already has. He is also thinking about attending a course to train as an electrician so that he may expand his trade. Would the costs of these courses be allowable for tax purposes and reduce his profits subject to income tax?

For training costs to be allowable, they must be incurred wholly and exclusively for the purposes of the trade. The course undertaken to refresh his skills in plumbing would be allowable as it is up-dating the skills of the individual for the trade that they are currently undertaking. This cost would then be deducted from the profits of the business.

The training costs for the electrician’s course however would not be allowable. The benefits obtained from this course give him a new skill and as such a new specialisation within his trade. It is therefore not incurred wholly and exclusively for the purposes of the trade.

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