Under the income tax, in respect of child education, an individual taxpayer can get a tax deduction of-
- Tuition fees paid for a maximum of 2 children [Section 80C]
- An interest of Education loan [Section 80E]
- Child Education Allowance [Salaried taxpayer only]
- Child Hostel Expense Allowance [Salaried taxpayer only]
In this article, we would cover tax exemption on child’s Tuition fees as provided under section 80C(2)(xvii).
So let’s get busy!
Only individual taxpayers can get the deduction of tuition fees under section 80C.
An individual taxpayer can get the deduction of maximum 2 children of his own [Both biological and adopted one].
This deduction is available to both husband and wife separately. Therefore a taxpayer with 4 children can get all school fees deduction by allocating 2 child’s fee to their spouse’s ITR.
Tuition fees of any university, college, school or other educational institution within India is allowed and such fee must be paid during the year. The education should be of full time.
Nursery School, Creches & play schools are also covered.
Private tuition fee or coaching fees are not allowed as deduction.
Basis of Deduction
The deduction will be on payment basis only i.e payment of arrear fee and an advance fee is available in the year of payment only.
Mr Reddy paid Rs.48,000/- as tuition fees of his son on 1st April 2017. The fee was for 2 years i.e FY 2017-18 and 2018-19.
Mr Reddy can get the deduction of the whole of Rs. 48,000/- under section 80C in ITR of AY 2018-19 [FY 2017-18]
Deduction under this section is limited to Rs. 1,50,000/- only.
Section 80C covers a wide range of other deductions also like LIC premium, Provident Fund, Mutual Fund, NSC, Tax saving fixed deposit etc.
Note: The deduction is not available in respect of-
- Tuition fee for self-education.
- Development fee, science fee, pupil fund, RD fund etc
- Fees paid for any Indian Institute located outside India.
- Part-time courses
- Education of a child where a taxpayer is a legal guardian
- Foreign university situated outside India
We’re not through yet!
As discussed in the start, a salaried taxpayer can also get the deduction of child’s education-related allowances.
Allowances are provided by an employer to his employee as part of his salary. There are various allowances which are exempted from tax.
In respect of child’s education there are two types of allowances:
- Child Education allowance- up to Rs.100 pm per child up to a maximum of 2 child
- Child Hostel Expenditure allowance- up to Rs.300 pm per child up to a maximum of 2 child