As taxpayers are filing their income tax return (ITR) for the Financial Year 2025-26, they are finding various ways to save income tax. Child education allowance (CEA) is one of the ways through which they can save their tax. Salaried employees who get CEA as part of their salary structure from their employer can claim CEA exemption. The exemption is available under Section 10(14) of the Income-tax Act, 1961, read with Rule 2BB of the Income-tax Rules.
For the income earned in FY 2025-26, CEA is Rs 100/month per child for up to 2 children. However, the limit has been increased by 30 times for the FY 2026-27 as taxpayers will be able to get up to Rs 3,000/month per child for up to 2 children, or up to Rs 72,000 in a financial year.
