Fact-check notes
Last fact-checked: 2026-05-27
Transition rule: AY 2026-27 covers FY 2025-26 and continues under the Income-tax Act, 1961. The Income-tax Act 2025 Tax Year language applies for income earned from 1 April 2026 onward.
This Batch 12 page avoids treating future-dated payroll/form/rule changes as final filing advice. Verify the active form, notification, payroll circular or portal utility before implementation.
What this covers
Children education and hostel allowances are salary exemption items when specifically structured and supported. Verify the revised limits in the active rules/form before payroll implementation.
- Allowance must be separately identified in salary, not buried in generic special allowance.
- The exemption cannot exceed actual eligible expenditure and applicable child limits.
- Receipts and employer declaration matter more than ITR-only claims.
Who this is for
- Employee with school-going children.
- Parent with hostel expenditure.
- HR team redesigning CTC.
- CA reviewing salary proof.
Documents and data to verify
- School fee receipts.
- Hostel receipts.
- Salary breakup.
- Employer declaration.
Common mistakes to avoid
- No separate allowance in CTC.
- No receipts.
- Claiming for more children than allowed.
- Using Tax Year 2026-27 limits for FY 2025-26 without confirmation.
How to proceed
- Confirm the applicable year, taxpayer type, form, state and portal status before acting.
- Reconcile portal data with payslips, books, invoices, Form 16/26AS/AIS, GST returns, EPFO records or contracts.
- Prepare a written computation, filing note, checklist or response with assumptions clearly stated.
- Download acknowledgements, challans, workings and evidence after filing or submission.
FAQs
Can WorkIndex help with this?
Yes. Post the facts and documents; relevant experts can quote for filing, advisory, reconciliation, registration, appeal support or ongoing compliance.
Is this page final legal advice?
No. Use it to prepare. A professional should verify the active law year, notification, portal utility and records before filing or taking a tax position.
What should I mention while posting?
Mention the year, state, form, deadline, amount involved, documents available, portal status and whether you need filing, correction, advisory or representation.