Deduction for Tuition Fees
Understanding Tax Deduction on Educational Expenses
Hello and welcome to Part 12 of the
income tax education series brought to you by H&R Block, the global leader in
filing income tax returns. Today we will understand if you can get a deduction of expenses
made for your children’s education.
Children’s education is getting costlier by the day. You can claim a deduction for
the amount of tuition fees paid to any educational institution for the purpose of
full time education of your child under section 80C. The amount of this deduction
is however limited to the amount of tuition fees only and does not include any development
or donation paid. E.g. you pay an amount of Rs. 60,000 as the total fees for the
year for your child but the tuition fee portion amounts only to Rs.40,000 then the
deduction u/s 80C will be restricted to only Rs. 40,000. The amount paid towards
donation, non-refundable deposits or canteen expenses is not allowed as a deduction.
Deduction is allowed for up to 2 children for each parent.
Apart from this there is one more deduction that you can claim u/s 80E of the IT
Act where you can claim interest paid on loan taken for higher education. The entire
amount paid as interest can be claimed as deduction without any limit. E.g. if you
take a loan of Rs. 5,00,000 for your child’s MBA and the interest repayment per year
@ 10% amounts to around Rs. 50,000 then this entire amount can be claimed as a deduction
from taxable income u/s 80E.
I hope you found this useful. If you have any further questions on this topic, please
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