Tax planning: Claiming tax rebates on children’s school fees

Tax deductions on expenses

However, even if you have chosen the old regime this financial year and want to maximise tax benefits, you needn’t always scour investment avenues eligible for tax-savings. Some expenses, too, qualify for deductions under Section 80C.

The section offers tax breaks on school/college tuition fees paid for up to two children, subject to the maximum limit of Rs 1.5 lakh. For example, fees paid towards your children’s education. It is an unavoidable expense for parents, so it makes sense to avail of this deduction before considering any further investments.

Also, even if the number of children is, say, three, both spouses can still maximise the tax benefits on offer since both partners have separate limits of two children each. In addition, do note that even your kid’s playschool, creche or nursery tuition fees are also eligible for the deduction.

Know the expenses that will not qualify  

While claiming this deduction, it is vital to know the education-linked expenses that are not considered eligible. For example, any capitation or donation fees and school bus charges will not qualify for the tax break. The key word is ‘tuition’ fee – look for this element in your child’s fee receipt. However, expenses incurred on children’s education at overseas institutions cannot be claimed as tax benefits under this section, though entities in India affiliated to international universities will be eligible.

Also read: From school fees to study abroad: A fool-proof plan for your child's education

Extracurricular activity classes, even if they are managed by the school, will not be eligible. The deduction is available only for full-time courses in formal educational institutions — part time or distance learning fees will not be allowed. Likewise, coaching class fees will not be taken into account.