Deducting school supplies from personal tax returns
This newsletter is addressed to those families whose children attend private schools that follow the international school calendar – from August to June.
In our country there is a small number of schools that follow the international school calendar. Parents whose children attend these schools must have in mind that they should keep the school supplies receipts if they wish to incorporate these expenses into their Income Tax Return for the year 2019.
Article 709 of the Tax Code describes the concepts that individuals can deduct, after having computed their taxable income. Law 37 of 2018, has added numeral 9 (school expenses) to article 709 of the Tax Code, for income tax returns for tax periods 2019 onwards. Below is a summary of this information:
According to article 709 of the Tax Code, the following will be tax deductible:
• yearly registration fee
• monthly tuition
* all related to the first and second level of education, that is, basic or middle level education.
• credit hours
* These expenses will be deductible as long as the dependents of legal age are under the guardianship of their parents or guardians. Although it can also be applied by taxpayers who pay their own study expenses.
** The maximum annual deduction will be up to three thousand six hundred balboas (B /. 3,600.00) for each dependent.
*** related to third level of education or higher education
In the cases in which the student has a disability that limits his/her mobility to the classroom, the expenses referred to in Article 709 the Tax Code will be deductible in its entirety.
We cite the Tax Code, article 709 (textually) for further reference
9. School expenses incurred with respect to the minor dependents of the taxpayer, including tuition and school fees, as well as school supplies, school uniforms and school transportation, related to the first level of general basic education or education and the second level teaching or secondary education.
Expenses incurred with respect to the third level of education or higher education of the taxpayer’s dependents of legal age, who are still under their guardianship, related to the payment of tuition and credit hours will be deductible. The deduction may be made up to an annual maximum of three thousand six hundred balboas (B / .3,600.00) for each dependent. This deduction may also be applied to taxpayers who pay for their own studies. ”
Additionally, in those where the education expenses correspond to children with a degree of disability that implies reduced mobility to the classrooms of an educational or university center, it will be allowed to deduct all the expenses referred to in numeral 9 of the article 709 of the Fiscal Code. ”
Our tax experts can advise you on this and various other tax related issues. For any questions you can contact us at 264-9511 or email@example.com
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