Tuition fees for studies in the operating costs of the company


Entrepreneurs who want to be up to date can benefit from various types of training or courses. Some also argue that it is worth investing in their education further and choose graduate or postgraduate studies. They can do it for themselves or for their work. It mainly depends on whether they will be able to count the expenses incurred on education as tax deductible costs. Check if tuition fees for college can be a tax cost!

Tuition fees for studies and tax deductible costs

The cost of obtaining income is really nothing but the expenses that the company or the taxpayer had to incur in order to receive income. If, for example, a taxpayer runs a florist's shop, the flowers must first be purchased before he can sell them. The baker will first have to buy flour, and the seamstress will have to buy materials and a sewing machine. All these expenses are tax deductible.

However, the above examples are very simple. It often happens that some expenses are difficult to settle. One of them is the expenditure on education and tuition fees for studies. In Chapter 4 of the Personal Income Tax Act, you can read about all the possibilities of recognizing expenses as tax deductible costs. There is no information on the tuition fees for studies there.

However, it is not clear that they cannot be included in the costs. Why? The catalog of expenses that legally cannot be included in the costs can be found in Art. 23 of the PIT Act. There, however, it is also in vain to look for information on the financing of tuition fees for studies.

Tuition fees for studies and business activity

It is up to the taxpayer to prove that studies are a guarantee of earning income. If the field of study is related to the profession or activity carried out, the tax authorities usually accept the recognition of expenses as tax deductible costs. In such a situation, expenses for commuting or scientific materials can also be included in the costs - of course, if it is properly documented.

A freshly graduated student must show that the expense is related to acquiring the knowledge and appropriate skills that will help him run his business or improve the quality of the services he offers. However, if, in the eyes of the tax authorities, studies are intended only to raise awareness in general, they will not allow these expenses to be classified as tax deductible costs. Of course, the taxpayer may appeal against this decision by requesting an individual tax interpretation.

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Tax deductible costs and language courses

The case of a language course is not much different than when it comes to college expenses. It really all depends on the proper documentation. A good example can be the individual interpretation of October 21, 2010:

Individual interpretation of the Director of the Tax Chamber in Warsaw of October 21, 2010, ref. No. IPPB1 / 415-778 / 10-2 / RS:

(...) The description of the future event presented in the application shows that the Applicant runs a business in the field of multimedia projects, mainly in the field of music and radio. The company with which the Applicant cooperates is expanding its activities in Ukraine and Russia. The applicant was obliged to provide substantive support to the Ukrainian branch in the construction and programming of the local Internet radio. For this purpose, the Applicant is forced to speak English with local employees. Due to the fact that the Applicant's knowledge of this language is insufficient, the Applicant, in order to maintain further cooperation with the G. company and retain the source of income, is forced to improve his skills in this area on a special course.

In the light of the above, it should be stated that improving the knowledge of the English language of an entrepreneur is aimed at maintaining the current source of income and attracting more and more customers. (...)

As you can see, entrepreneur education, tuition fees and language courses in most cases can be classified as tax deductible costs. However, the taxpayer must remember that the field of study should be related to the activity conducted by him. Because during a possible inspection, he will have to prove that thanks to science, the quality of his services will increase, and the acquired knowledge will help him improve the company.

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