But the High Court today dismissed the appeal and ordered the commissioner to pay Miss Anstis’s costs. The ruling opens the way for hundreds of thousands of youth allowance recipients - and possibly other income-support recipients - to claim tax deductions for expenses they incur in qualifying for their payments. Miss Anstis said she never imagined her attempt to claim a few hundred dollars in deductions would result in a landmark judgment that would have national ramifications. ‘‘We never thought it would go this far,’’ Miss Anstis said. ‘‘It was just a problem with my tax return, I had a dispute and I was just hoping I would get that little bit extra back on my tax return.

‘‘Any little bit helps when you’re a student on Youth Allowance so I think this might make it just that little bit easier for students. ‘‘I’m really happy with the decision. I expected the result but I’m really happy that we won.’’ Miss Anstis, now a primary school teacher in Springvale, said she had gone to the High Court of Australia in Melbourne today to pick up the judgment. ‘‘The receptionist told us before we opened the envelope,’’ she said. ‘‘I was just really happy. I think we should celebrate but we haven’t really made any plans. We’re still just coming to terms with what has happened.’’

In its advice to the incoming federal government in September, Treasury warned that if the High Court dismissed the Commissioner of Taxation appeal, there would be "significant budget implications". The cost to the budget is not known but is likely to represent several million dollars. Miss Anstis was successful last year in her bid to claim $920 as self-education expenses after fighting the Tax Office through a number of jurisdictions over three years. While studying full-time to be a primary teacher, Miss Anstis worked as a part-time sales assistant for retail chain Katies, where she earned $14,946. She also received a youth allowance of $3622 during the 2006 income year.

She claimed education expenses including travel costs, supplies for children during teaching rounds, student administration fees and depreciation of her computer. The Tax Office rejected the claim, so Miss Anstis and her father, Michael, who is a qualified solicitor but does not work as a lawyer, fought it all the way to the Federal Court, which handed down its ruling in Melbourne last November. The full court of the Federal Court upheld an earlier decision that, because the former student had to be enrolled in a full-time course of study to get her assessable income of youth allowance, any costs incurred in the course of studying should be deductible. About 440,000 students receive youth allowance or Austudy. Many of these students would earn enough with the addition of part-time work to have a tax liability, Associate Professor Dale Boccabella from the University of NSW said.

He said last year items including computer depreciation, stationery or textbooks could now be claimed as a deduction. In the past, the Tax Office had made it clear it would not allow educational expenses to be claimed against welfare payments. "The decision further complicates tax administration in the area of self-education expenses, an area that is already riddled with difficulties," he said. The Australian Tax Office has urged people who believe they may be affected by the ruling to be patient as it considers the impact of the judgement. "We are giving the matter urgent attention and will release further information as quickly as possible," a spokeswoman said.

The Assistant Treasurer, Bill Shorten, issued a statement acknowledging the High Court’s decision. The statement says the Australian Taxation Office would analyse the judgement and produce a Decision Impact Statement, which would state the Commissioner’s position and how the law would be administered as a consequence of the decision. The statement is expected to take several days and possibly weeks. Mr Shorten’s statement said the government would ’’carefully consider the judgement and Decision Impact Statement’’ before issuing a further response. Treasurer Wayne Swan is in Korea with Prime Minister Julia Gillard, where they are attending the G20 summit. - with Heath Gilmore



