Deduction u/s. 80C for tuition / school / education fees

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Deduction
u/s. 80C for tuition / school fees paid for education of
children
Who is
Eligible
: Deduction for tuition
fees u/s. 80C of the Income
Tax Act 1961 is available to Individual Assessee and is not
available to HUF.
Maximum
Child: 
Deduction under this section is available for tuition
fees paid on two children’s education. If Assessee have more then two children
then he can claim tuition fees paid of only two children’s. The Deduction is
available for any two children.
Here we would like to
mention that husband and wife both have a separate limit of two children each,
so they can claim deduction for 2 children each.


Expenditure 
paid for self education not allowable: –
 This is
the only clause u/s 80C where assessee can not claim tax benefit for
expenditure incurred for self. In other words if assessee has paid tuition fees
for his own studies, he will not be eligible for
deduction.
Fees paid
for spouse:
 Deduction
is not available for tuition fees paid for studies of spouse.
Maximum
Limit:
 Deduction
for tuition Fees is available up to Rs. 100000 (Rs. 1.50 Lakh from A.Y.
2015-16).  Please Note that aggregate amount of deduction  under
section 80C , 80CCC and  80CCD shall not  exceed Rs. 1,00,000/- (Rs.
1.50 Lakh from A.Y. 2015-16).
Deduction
available on payment basis: –
 Deduction
under this section is available on payment basis. Fees may be related to any
period. For example feed paid
for April 2009 if Paid in March 2009 will be eligible for deduction u/s. 80C in
A.Y. 2009-10.
Deduction
not available for part time course:-
 The
deduction is available for Full Time courses only.   In our opinion
no deduction is available for part time or distance learning courses.
Fees for
Private tuition/Coaching Classes not eligible for deduction u/s. 80C :-
 The fees should be paid to university, college,
school or other educational
institution. No deduction available for fees paid for private
tuition’s , coaching courses for admission in professional courses or any other
type of courses are not covered as that fee is not paid for FULL time
education.
Location
of University, college, school or other educational institution: 
University,
college, school or other educational institution must be situated in India
though it can be affiliated to any foreign institutes.
Allow
ability of pre-nursery, play school and nursery class fees: –
 Pre-nursery, play school and nursery class fees
is also covered under section 80C (circular 9/2008
& 8/2007).
Not
allowable Expenses:-
1. Development fees or
donation not eligible.
2. Transport charges, hostel charges, Mess
charges, library fees, scooter/cycle/car stand charges 
incurred
for education are not allowed.
3. Late fees is not
eligible for deduction.
4. Term Fees is not
eligible for deduction.
5. No deduction for part
time or distance learning courses.
6. no rebate for private
tuition.
7. Building fund or any
donation etc not allowed.
Note: Above
list is not exhaustive.
Summary
of Above Provisions
1) Deduction from taxable
income under Section 80C is available to individual taxpayers up to a maximum amount of Rs1
lakh for education expenses incurred for one’s children.
2) Each parent can claim
the deduction for the tuition fees paid for up to two children each, thereby
covering a maximum of four children in a family.
3) This deduction is
available to the parent who has made the payment, to the extent of the tuition
fee actually paid or
Rs 1 lakh (Rs. 1.50 Lakh from A.Y. 2015-16), whichever is lower.
4) The deduction can be
claimed only for full-time courses including pre-nursery and playschool.
Part-time, distance learning courses, private tuitions and coaching classes are
not covered.
5) This deduction can be
availed of on the basis of actual payment made, irrespective of the period to
which the fee may pertain.
6) Only the tuition fee
paid is eligible for deduction. Other expenses, such as transport charges,
library charges, hostel charges, development fees or donation, are not covered.
FREQUENTLY
ASKED QUESTIONS ON DEDUCTION FOR TUITION FEES U/S. 80C
Q. Can an
unmarried person can claim deduction u/s 80C of Income tax Act, 1961 for school
fee paid for 2 children?
Answer: Yes he
can. As clause (c )  of subsection 4 of Section 80C only speaks of
children’s of Individual.  Section 80C is silent on legality of child and
it does not say that child should be legal child.
Q. Can I
claim deduction u/s 80C of Income tax Act, 1961 for my adopted child’s school
fees?
Answer: Yes you can. As
section 80C again silent and do not specify that child should be biological
child for the purpose of claiming deduction under clause (xvii) of section 80C.
Q. I have
divorced to my wife and have custody of my son with me and paying his school
fees. Will I be eligible for deduction u/s 80C of Income tax Act, 1961 for
school fee paid on his education?
Answer: Yes you will. As
section 80C do not specify that marriage should continue to claim the deduction
under clause (xvii) of section 80C.
Q. Can I
claim deduction under section 80C for tuition fees paid to an Indian
institution for my wife’s education?
Answer: No you can’t claim.
Deduction u/s. 80C is available only for tuition fees paid for two children’s
education.
Q. I and
my wife both paid for education of our one child. My wife paid 70,000 and I
paid 1,60,000/- can we both claim deduction?
Answer: Yes both of you can
claim deduction u/s 80C up to a maximum of Rs.  1,50,000 each.  You
can claim deduction up to 150000/- and your wife can claim deduction of Rs.
70,000/-.
Q. I am
currently working and studying. If  I pay my tuition fees out my
own earnings and do not take an educational loan, will I get any tax benefits?
Answer: The tuition
fees paid by you will not make you eligible for any tax benefits. You will not
be able to claim any income tax deduction.
Q. I am a
working women and I am paying the education fees for my husband education. Can
I claim the deduction for this?
Answer: Payment of tuition
fee up to Rs 1 lakh (Rs. 1.50 Lakh from A.Y. 2015-16)  can be claimed as
deduction u/s 80C of the I T Act. But the payment of tuition fee for full time
course must be for for any two children of individual. It follows therefore one
can not claim deduction for payment of tuition fee for his/her spouse.
Question:-
Section 80C allows deduction in respect of tuition fee but excludes payments
towards development fees, donations or payments of similar nature.
Does this
mean that the items not specifically excluded, such as fees for games,
magazines, stationery, Parents’ Teacher Association fees, Staff Benefit Fund,
Gratuity Fund, and hostel will not qualify for the deduction?
Answer:- None of these will
qualify for deduction under Section 80C of the Income-Tax Act, 1961.
The deduction available
under this Section is for sums paid as tuition fees (excluding any payment
towards any development fees or donation or payment of a similar nature)
whether at the time of admission or thereafter to any university, college,
school or other educational institutions within India for the purpose of
full-time education of any two children of an individual. The principle
requirement for qualifying for deduction under this provision would be that the
fee paid should be in the nature of tuition fee. All of the items enumerated by
you are essentially not in the nature of tuition fee, and so cannot qualify for
deduction.
You may note that the
development fee or donation or payments of a similar nature even if they are in
the nature of tuition fees will not qualify for the deduction under this
Section.
Question:-
Can Mother claim the benefit of tuition fees paid for his son/daughter.
Answer:  Assessee
means both mother and father both can take the benefit u/s 80 C for amount paid
by them respectively.
Question:-
If a couple have four children, can they both claim fees for two children each?
Answer: Yes ,husband and
wife both have a separate limit of two children each ,so they can claim
deduction for 2 children each.
Question:-
If a Couple has one child and paid a fees of Rs. 250000  can they both
claim tuition fess 150000 each ?
Answer:  yes ,they
both can claim deduction for 150000 each subject to they have actually paid
same amount. If husband has paid 1.50 lac and wife has paid 1 Lakh then husband
can claim 150000 and wife can claim 100000.
Question:-  Ram has
paid tuition fees for his child 2000/- in February 2014  relates to period
march to June 2014 ,how much amount he can claim deduction in assessment year
2014-04?
Answer:  He can claim
full 2000 Rs in assessment year 2014-15 , as this deduction is available on the
basis of payment and it may or may not be related to the period in which it has
been paid.
Question:- 
Is Late fees paid with tuition fees is eligible for deduction ?
Answer:   No,late fees
is not eligible for deduction.
EXTRACT
OF SECTION 80C
Clause
xvii of section 80C
xvii) as tuition fees
(excluding any payment towards any development fees or donation or payment of
similar nature), whether at the time of admission or thereafter,
(a) to any university,
college, school or other educational institution situated within India;
(b) for the purpose of full-time education of any of
the persons specified in sub-section (4);
Subsection
4 of Section 80C
“(4) The persons referred
to in sub-section (2) shall be the following, namely:
(a) ………………….
(b) …………………..
(c) for the purposes of
clause (xvii) of that sub-section, in the case of an individual, any two
children of such individual.

Note-
(Republished with Amendments)
RECOMMENDED READ  Section 80D, 80DD and 80DDB
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