Tax Benefits on Tuition and School Fees

When we educate a child, we not only make him be able to read and write, but we give him an important tool that would help him shape up his present and his future. Imparting right education can help the child find the right path in life, trading on which he can one day conquer the world.

Sending the child to school is not just a responsibility but it also gives a sense of fulfilment to the parent that he is able to provide for his/her child. Education, after all, is the foundation for a comfortable and successful future. But with changing times, providing our children with a decent education is also a matter of concern. Day by day there is an increase in the cost of education. Forget about professional education, these days even pre-primary schooling can make a big hole in the pocket of the parents.

What many of us may not know is that paying the school fee can also have some other advantages for the parents. The Indian government keeps making policies and plans to promote education in all sections of society. A tax benefit also helps the country to move towards a higher rate of literacy. In today’s article, we will confer about the tax benefits on tuition and school fees.

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Here are the eligibility criteria that must be met by the individual if he has to avail the tax benefits on tuition and school fees.

Individual Assessee

HUF or corporates cannot file for claims. Only the individual assessee who are the taxpayers can avail the tax benefits.

Deduction Limit

The limit that is permitted for deduction under Section 80C of the Income Tax Act, 1961 is INR 1.5 lakh each financial year. In case, both parents are paying taxes then up to four children ’s tuition fee can also be claimed.

Only for Child’s Education

The taxpayer can avail a tax benefit only for his own or for his adopted children. The tax benefits on tuition and school fees are not available for self or spouse.

Affiliation

All registered universities, colleges, schools or other educational institutions qualify for tax benefits on tuition and school fees.

Kind of Education

Only full-time courses and programmes are considered for the benefit, Part-Time courses are not.

Apart from Section 80C, the taxpayer can also get some tax benefits on tuition and school fees under Section 10 of the Income Tax Act, 1961. With this provision, the salaried taxpayer can save on the taxes that he has to pay to the tune of INR 100 every month per child. This facility is, however, only applicable for two children, which comes to INR 200 every month. It should be remembered that the claim has to be made in the same financial year when the fees were paid. Other than this, the taxpayer can also claim an exemption of INR 300 for each child on the hostel costs.

The facility to claim tax benefits on tuition and school fees is a big boon given by the government to all salaried employees and must be availed wisely. The limit for availing tax-benefits is INR 1.5 lakhs, once you save taxes on the child’s tuition fee you may also plan to invest in some long-term policies.