Parents can significantly reduce their tax burden by claiming deductions on their children's school and college tuition fees under the old income tax regime. However, those opting for the new tax regime from the financial year 2025-26 may need to reconsider their tax-saving strategies.
The Indian government introduced changes to the tax structure in the Union Budget 2025, with Finance Minister Nirmala Sitharaman making annual incomes up to ₹12 lakh tax-free under the new regime. The revised tax slabs may encourage many taxpayers to switch to the new system. However, those seeking deductions on tuition fees will need to stick with the old regime, as such benefits are not available under the new structure.
Under Section 80C of the Income Tax Act, 1961, taxpayers can claim deductions of up to ₹1.5 lakh annually on various investments, including school and college tuition fees. This benefit applies to up to two children per taxpayer and is an easy-to-claim deduction, as most parents naturally incur these expenses.
Parents can claim deductions on tuition fees for their children studying in schools, colleges, nurseries, playschools, and creches. However, the following expenses are not eligible for tax benefits:
To claim this deduction, taxpayers must obtain a certificate from the educational institution confirming the total tuition fees paid during the financial year. Many schools collect annual fees by January, so it is advisable to request the certificate after making the final payment.
By utilizing this tax-saving option, parents can effectively lower their taxable income and reduce their overall tax liability.
