regulate discounts for educational expenses

The norms defined which are the admitted educational expenses, the limit that can be deducted annually and the form of charge.

regulation

The regulation establishes thatCertain expenses related to the education of dependent children may be deducted. Those that are deducted as family burden.

These are understood to be sons, daughters, step-sons or step-daughters under eighteen years of age or disabled for work and those over the age of 18 and up to and including 24 years (in the latter case to the extent that they are enrolled in regular or professional studies in an art or trade that prevents them from providing themselves with the necessary means to support themselves), provided that they have the status of family burden for them.

The concepts of expenses to be deducted are educational services, understood as the services provided by public and/or private educational establishments incorporated into the official education plans and recognized as such by the respective jurisdictions.

Refers to teaching at all levels and degrees contemplated in said plans, and postgraduate for graduates of secondary, tertiary or university levels, as well as refreshment, accommodation and transport services accessory to the above, provided directly by said establishments with their own means or those of others, the classes given in a private capacity on subjects included in the official teaching plans and to nurseries and maternal-infantile gardens.

On the other hand, the purchase of tools for education may also be discounted and makes exhaustive mention of school supplies, overalls and uniforms.

indicates Sebastian DominguezCEO of SDC Asesores Tributarios, who The regulation is very restrictive and takes many years back, since it should include all the necessary and current tools for education such as computers, notebooks, tablets, software for educational purposes, etc.

The maximum amount to be deducted is limited to 40% of the amount of the minimum non-taxable profit that corresponds to the fiscal period.

For the year 2022, the non-taxable minimum was established at $252,564.85, so the maximum expense deduction is $101,025.94 for the entire year.

Thus, for a taxpayer who pays the maximum income tax rate of 35%, the maximum tax savings per year that can be reached is $35,359.08.

Following this calculation, Domínguez exemplifies as follows: if a taxpayer has 2 dependent minor children, sent them to a private school and paid $800,000 in fees during 2022, they could deduct $8,418.83 monthly average and would save a maximum of $2,946.59 average per month, if it is taxed at 35%.

“That is, the savings would be $35,359.08 per year, a benefit of 3.53% on the value of the contributions of $800,000. This is counting that he is an employee who pays the maximum rate, the lower the scale, the lower the savings will be,” said the tax official.

How to do the procedure

General Resolution (AFIP) 5314 establishes that employees in a dependency relationship must report expenses through Form F.572Web generated through the “SIRADIG – Worker” service, which is accessed with a tax code.

When loading the information, the system will request that the data of the invoice or equivalent document that supports the expenses be provided.

At the time of preparing this note, although the General Resolution is in force, the service still does not contemplate the possibility of charging the expenses, as can be seen here:

Employees must report education expenses until 03/31/2023 or earlier if they leave the company in which they work.

The employer will consider this information when making the annual settlement in April 2023 or the final one if the separation is made earlier.

If applicable, the employee will receive a refund of withholdings made when incorporating these expenses.