Deduction under section 80C for tuition or school or education fees
Individual Assessee are eligible to claim the deduction of tution fees.There is a limit of of Maximum two children and a monetary limit of Rs 100000 under Sec 80C
We have to understand that both Husband and wife have a limit of two children each, so a maximum of 4 children's tution fees can be claimed. However, the payer of the fees is also important, since the payer of the tution fees is only eligible for this deduction. So, as a better tax planning measure, both husband and wife should share and pay the tution fees to avail of this benefit.
It is also necessary for us to know that both husband and wife can claim benefit under this section for the same child if both have paid the fees. Then, each spouse can get deduction upto Rs 100000 each.
Suppose, total tution fees p.a for a child is Rs 175000. Husband has paid Rs 110000. wife has paid 65000. In this case, husband can avail deduction of Rs 100000 ( max Limit) and wife can avail deduction of Rs 65000. If they had good tax saving plans, they could have availed another Rs 10000 deduction.
Lets now see some of the nuiances of this section
- Expenditure paid for self education is not allowable, its only related to child education ( may be adopted or illegal child, marriage may not be subsisting)
- Fees paid for spouse is not allowable
- Deduction is available on PAYMENT BASIS. So, if you have paid the fees pertaning to any previous period or subsequent period, it will also be available for deduction
- Deduction will not available for part time courses, it has to be full time courses only.
- Tution fees paid to Private tuition or Coaching Classes are not eligible for deduction u/s. 80C
It is also very important to know what constitues Tution fees and what are the components which are not allowed-
- Development fees or donation is not eligible
- Transport charges, hostel charges, library fees are not eligible
- Late fees is not eligible.
- Term Fees is not eligible
- Part time or distance learning courses are not eligible .
- Building fund or any donation is not eligible
Tution fee paid is a good tax-saving expenditure. Tax season is beginning , plan your tax savings ,Keep the fee reciepts handy and safe and reduce your tax burden
Kindly revert for any queries