How to Qualify for Education-Related Tax Deductions and Credits

The cost of education in India is rising steeply, which makes funding your child’s education an important part of financial planning. Fortunately, to ease the burden, the government extends tax relief in the form of education-related tax deductions.

The season of income tax filing is here, and it’s time to arm yourself with proper information.

You can claim a deduction under the following sections:

• Section 80C offers deductions for tuition fees.

• Section 80E offers deductions for interest paid on education loans.

• Section 10(14) is for scholarships, and grants that cover education costs are exempt from tax.

Individual taxpayers can claim exemption on educational expenses under Sections 10(14) and 80C. Here are the steps you need to follow:

• Salaried individuals must submit the school/institution fee receipt to their employer by year-end during investment proof submission. They must also declare the expense in Form 12BB for tax benefits.

• Non-salaried individuals can claim only the tuition fee deduction under Section 80C (VI-A schedule). They do not need to submit bills while filing their ITR. However, they should keep the receipts as proof to support their claims if required.

Before planning your tax filing, check out the eligibility requirements for claiming tax benefits for educational expenses and how to maximise your savings.  

To qualify for education-related tax deductions, one must fall within specific income limits, which are:

• Individuals earning less than ₹5,00,000 can benefit from tax rebates under Section 87A

• Applicants must have residency status in India to be eligible for these deductions

Deductions are only applicable to fees paid to recognised educational institutions. These include colleges and universities approved by the following bodies:

• University Grants Commission (UGC) or other relevant authorities

• All India Council for Technical Education (AICTE)

Tax benefits apply to a variety of educational courses, including:

• Engineering

• Medicine

• Management studies

Ineligible expenses include:

• Donations or capitation fees

• Extracurricular activity fees

• Tax benefits for educational expenses are available under Section 80C, Section 80E, and Section 10(14).

• Only Indian residents earning below ₹5,00,000 can claim tax rebates under Section 87A.

• Deductions apply only to recognised educational institutions and courses.

Can I claim education expenses on tax returns?

Yes, you can claim deductions on educational expenses under Sections 10(14) and 80C.

What is the education tax credit, and how can I qualify?

If you are an Indian citizen and your yearly income is less than ₹5,00,000, you can apply for this exemption.

Are graduate students eligible for education-related tax deductions?

Yes, graduation courses are eligible for tax deductions under Sections 80C, 80E, and 10(14).

How much of my tuition can I claim for a tax deduction?

You can claim tuition fees of up to ₹1,50,000 per year for a tax deduction under Section 80C.

What types of educational expenses are deductible for tax purposes?

Any sort of tuition fee is eligible for tax deductions.

How do I apply for education-related tax credits and deductions?

If you are a salaried individual, you can fill out the 12BB form and submit the tuition fee receipts. If you are a non-salaried individual, then claim your deduction under section (VI-A).

Can I claim both the education tax credit and the education expense deduction?

Yes, because credit means taking a loan for education, So if you are paying the interest of an education expense tax credit, you can opt for tax exemption.

Return to Goal