Why is study assistance paid through the payroll system?
When a course of study would not be allowed as a tax deduction for self-education expenses, Fringe Benefits Tax would be payable. Under the Income Tax Assessment Act 1997, higher education contributions, Open Learning charges and debt repayments under the HELP scheme are not allowed as self-education expenses. This means that the University would be liable for Fringe Benefits Tax on payment towards course fees. This would reduce the available budget for allocation to staff. In order to obviate the Universitys need to pay FBT, payment is made to the staff member as salary, through the payroll system, with income tax deducted.
