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Study costs as business expenses: further training or retraining?

For freelancers (self-employed without employees), study costs are generally tax-deductible, provided they meet certain conditions. Below are the rules that apply to deductible study costs:

  1. Business Purpose

    • The study costs must have a clear business purpose. This means that the study or course must directly relate to your current or future work as a freelancer.
    • If the study contributes to improving your professional knowledge or skills used in your business, the costs are deductible.

  2. No Personal Expenses

    • Education or courses taken for personal development or hobbies are not deductible.
    • The costs must pertain to your business, not personal matters.

  3. Types of Deductible Costs

    You can deduct various costs, including:

    • Tuition or course fees.
    • Study books and other study materials.
    • Travel expenses, provided they are for business-related studies.

  4. Study Costs as Business Expenses

    For freelancers, study costs are considered business expenses. This means that you can deduct these costs from your profit, which can lower your tax burden.

  5. No Threshold or Maximum

    Unlike employees and private individuals, freelancers are not subject to thresholds or maximum amounts for deducting study costs. As long as the costs are business-related, you can fully deduct them.

  6. VAT Deduction

    If the educator charges VAT on the study costs, you can reclaim this VAT as a VAT-liable freelancer, provided the study is directly related to your business.

  7. Retraining or Reskilling Costs

    If you are pursuing a course to switch to another profession, it may be more difficult to deduct the costs, as they may not be considered necessary for your current business.

by Stefan Handstede Last update: 17 Oct, 2024