The government gives a tax incentive for educating children. The amount of tuition fee that you pay for your children is deductible from your income under section 80C. However, this tax rule is subject to certain conditions.
What is eligible
If you have enrolled your children for full-time education in any school, college or university and the institute is located in India, then you are eligible for tax deduction up to Rs 1 lakh on the tuition fees you pay. You can get this deduction for the tuition fees paid for two children only.
However, since both parents are eligible for deduction separately, they can together claim a deduction for four children.
Remember that the overall limit for tax deduction under sections 80C, 80CCC and 80CCD is Rs 1 lakh only. In other words, investments in a life insurance policy or a Public Provident Fund would be part of this limit.
The deduction is also available on the tuition fees paid for an adopted child.
What is not eligible
The deduction cannot be claimed for private tuition, coaching classes, development fees and donations, transport charges, mess, hostel and library fees.
There is no deduction available on the tuition fess you pay for your spouse, contrary to popular perception. In fact, the Act specifically mentions deduction for children.