Education can have a profound effect on the quality of life. The government has several tax reliefs for those who pay income taxes and invest in educational opportunities. Let's take a look at some of these benefits.
You can claim a deduction of up to Rs. 1.50 lakh for your children's education every year, in respect of tuition fees paid for full-time education in India. This benefit is available together with other deductions like contributions to provident fund and PPF, home loan repayment and life insurance premium. The deduction covers expenses incurred by you on educational courses taken by your children in any school, college or university in India. Coaching classes are not eligible for this deduction.
To claim a tuition fee deduction, you must have paid the fees in respect of any courses or programs at any time during the year. If you have more than two children who are attending full time postsecondary educational institutions at different times in the year, you may claim the deduction for only two of them. However, if your spouse is also working and has paid for his or her own tuition, then he or she can also claim a deduction for other children.
Besides the benefit of tax-free tuition fees, a person can claim deductions for interest paid on education loans taken to finance higher education for certain relatives. To be eligible for this deduction, the education must have been undertaken after completion of Senior Secondary Examination; it can be claimed for yourself, spouse and any number of your children. You can also claim this deduction if you are a legal guardian of a child.
You can claim this deduction for eight years, starting from the year you begin paying the loan. Please note that this deduction is only available for payment of interest; if you make a payment for the principal amount, you cannot claim the deduction. Unlike home loans, there is no monetary limit on claiming this deduction on education loans.
We’re pretty certain the above discussion will help you better understand the tax benefits for education. If you are looking for the best income tax course online, get in touch with RTS Professional Study today! Taxation is a complex field that requires much time and effort to understand. Our content is updated regularly so that it stays relevant and up-to-date with current industry standards.
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