It’s called the Antsis decision – one young lady who took on the ATO and one. In this case a student successfully argued in court that her self-education expenses were deductible against her Austudy income. The court decided that there was sufficient connection between the expense on education and the earning of her Austudy payment.
This was a surprising test case result for the ATO. They are currently amending all affected returns for the last couple of years automatically with a deemed $500 deduction. However, taxpayers can add more deductions where they can substantiate then.
Please note – the law will be changed and from the 2012 tax year it is much harder to claim any deductions against Commonwealth government payments.