University Costs and Tax Relief: What Support Might Be Available

Doctors often assume that university or training fees will reduce their tax because the study is linked to their career. In practice, university costs relief depends on who pays, why they pay and how you work.

This guide explains what may qualify for doctors and NHS consultants, what usually does not and how to make a claim. It applies to UK tax for 2026/27, although the rules on employee expenses are not new.

At a Glance

Cost	Usual position
Your child’s university fees	No Income Tax relief
Registrar exams and courses on a training contract	May qualify
CPD paid for by an employed consultant	Usually no relief
Approved professional subscriptions	Usually qualify
Training for existing private practice	May qualify
Training for a new business	Does not usually qualify
Work-related training funded by an employer	Usually tax-free for the employee

Paying Your Child’s University Fees

There is no general Income Tax relief for parents who pay a child’s university fees or living costs. You normally pay them from income that has already been taxed.

There may still be an Inheritance Tax angle. Payments for a child’s maintenance, education or training can fall outside Inheritance Tax where conditions are met, including for a child over 18 who remains in full-time education.

Be careful with company funds. If your company pays or reimburses an employee’s child’s school fees, it creates earnings or a reportable benefit. You should expect a similar analysis if a company pays university fees for a director’s child.

HMRC also warns about schemes that divert dividends to fund education fees. Its view is that arrangements using new share classes to pass dividends to minor children do not work.

Doctors in Training

The most important relief for many doctors is for those on a training contract. The Court of Appeal allowed a deduction in HMRC v Banerjee, where training was an intrinsic contractual duty of the employment.

HMRC’s guidance says you need to show that:

• Training is an intrinsic part of your contractual duties
• Your other duties form part of the training process
• The external training is a mandatory part of the employment
• You cannot continue in the post-qualification role without it

A mandatory course is not enough by itself. In the Decadt case, a hospital doctor could not claim exam costs because he was not employed on a training contract.

HMRC keeps a list of medical courses and exams that meet these requirements. It includes exams such as MRCP, MRCS, MRCGP, MRCPsych and FRCA. The list is not exhaustive, but your contract of employment must still be a training contract.

HMRC’s example of a registrar on a training contract allows travel, course fees and other associated costs that the employee meets personally.

Employed Consultants and CPD

Employed consultants face a stricter position. HMRC says no deduction is due for continuing professional education, even if it is compulsory and failing to complete it could affect your job or qualification.

The reason is the test for employees. A cost must arise in performing your duties, and HMRC sees most education as preparation for those duties. The same principle usually affects a further degree taken to improve your career prospects.

Professional subscriptions are different. You can claim for professional fees you must pay to do your job, and for subscriptions to HMRC-approved bodies relevant to your work. HMRC’s List 3 includes the General Medical Council and the Royal College of Anaesthetists, for example. Relief on British Medical Association subscriptions is restricted to 85%.

Private Practice and Self-Employment

The rules are more flexible if you are self-employed. You can usually claim training that improves skills you currently use in your business or keeps you up to date in your field.

You cannot claim for training that helps you start a new business or move into an unrelated area. HMRC’s examples of allowable training show the same dividing line: updating existing skills usually qualifies, while a course for a new business does not.

For a doctor with both NHS and private work, the purpose of the course matters. Keep evidence showing how it relates to your existing private practice, particularly if you also benefit from it in your NHS role.

When Your Employer Pays

If your employer or a third party funds work-related training, the section 250 exemption can prevent a tax charge. This does not apply if the payment is really a reward.

You cannot claim tax relief on any amount that your employer has paid or reimbursed. If your employer pays part of the cost, you can only consider the part you paid yourself.

If you are taking a full-time course, scholarship income may be exempt. Employer payments for full-time study have separate conditions, so check the terms before you agree to them.

How to Claim

Employees can usually claim for the current tax year and the previous 4 tax years. If you file a Self Assessment tax return, you must claim through the return. Budget 2026 announced that the £2,500 expenses threshold for Self Assessment will go from April 2028, so more employees can claim through PAYE.

The relief depends on your tax rate. For example, a qualifying £1,000 exam fee saves a 40% taxpayer £400, provided you have paid enough tax in that year.

Keep your receipts, your contract, your training requirements and any evidence of employer reimbursement. Self-employed doctors should record eligible training in their accounts.

Check Before You Claim

1. Confirm who paid the cost and whether anyone reimbursed you.
2. Check whether you were on a training contract at the time.
3. Compare the course with HMRC’s medical list.
4. Separate NHS, private and personal purposes.
5. Gather evidence before you submit a claim.

The position depends on your contract and working arrangements, so a claim is not automatic. Our guides to tax deductions for doctors and personal expenses for hospital doctors cover other costs you may be able to claim. Contact Nichols Medical Accountants if you would like us to review your position.