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There are several provisions under the Income Tax Act for parents to claim deductions for the tuition fees of their children.
Can I claim deductions for expenses related to children’s education?
The government provides several tangible financial incentives to support families to meet various expenses related to their children’s education, and healthcare, among others. To secure a better future for their children, parents can benefit from these tax breaks to alleviate the financial burden.
Here we have detailed the various benefits that allow parents to save taxes and plan for their children’s future:
Education Expenses
Under Section 10 of the Income Tax Act, salaried individuals are offered certain tax rebates and exemptions, including tuition fees for children, travel allowance and others.
Salaried taxpayers are entitled to certain allowances under Section 10(14) including the deduction of ₹100 per month per child to cover their children’s education allowance. They get a deduction of ₹300 per month per child on hostel expenditure allowance. However, these are only for up to a maximum of two children.
In addition to this, the tuition fees paid by parents for their children’s education are deductible under Section 80C of the Income Tax Act, wherein each of the parents can claim a maximum deduction of up to ₹1,50,000.
This covers tuition fees paid to schools, colleges and other educational institutes in the country for up to two children.
Education loan
Under Section 80E of the I-T Act, parents can claim deductions of interest paid on education loans.
There is no upper limit on the amount of interest, while the deduction is available for eight consecutive years starting from the year when the interest repayment begins.
Health insurance premiums
Under Section 80D, parents can claim a deduction of up to ₹25,000 for paying health insurance premiums for their children.
Besides this, deductions are available under Sections 80DD and 80DDB for the expenses incurred on the medical treatment of children with disabilities.
Sukanya Samriddhi Yojana
This flagship scheme of the government is a major tax-saving option for those having a girl child below 10 years of age.
Keywords: tax benefits on children’s education, tax benefits for parents, income tax act, business news
