In 11 November 2010, the High Court dismissed the Commissioner’s appeal against the decision of the Full Federal Court in Federal Commissioner of Taxation v Anstis.

Taxpayers who have received a taxable Commonwealth education payment may be affected by the decision.

The Australian Taxation Office does not like the decision and may ask the Government to change the legislation to prevent taxpayers following the High Court decision.

Those who have not claimed education expenses against Austudy, Youth Allowance or similar benefits, may want to lodge an objection or lodged amended returns now in case the law changes prospectively.

Thousands of students receiving these taxable allowances will benefit from the decision, but you need to be earning taxable income before a deduction is any real benefit.

A lot of students work part-time to supplement their allowances, so they are the main beneficiaries.

It means if you qualify items such as course fees, stationery and text books and the depreciation of computers will be able to be claimed.

Naturally, check with your tax agent to find out the extent of the deductible items you are entitled to and how urgently you may need to make a decision.