Compensation for children under 18 / Accountants explain how you can also benefit from reimbursement for their education

For around 500,000 children under the age of 18, according to changes in the law on income tax, this year parents, in addition to the legal obligation to complete the DIVA declaration, may also benefit from financial advantages.

With the latest changes to the income tax law, parents benefit from a deduction from the taxable base of 48,000 ALL for each child and, if they have additional education-related expenses, compensation of up to 100,000 ALL.

But what steps should be followed to benefit from these deductions?

First, the individual with the higher income in the family must access the e-filing system of the General Directorate of Taxes. If already registered, they can log in directly; otherwise, registration can also be done using e-Albania credentials. After entering the “Declarations” section, there is the option “My declarations / Undelivered.” In the case of a self-employed individual, the DIVA declaration appears with all outstanding tax obligations and the sections for deductible expenses.

“In the section ‘Compensation for dependent children,’ we enter the number of children, and the system automatically applies 48,000 ALL, 96,000 ALL, or more for three or more children. The system then automatically calculates the tax portion.

To benefit from education-related expenses, the first condition is that annual income must be under 1.2 million ALL, and there must be supporting documents such as the contract with the school and payment receipts.

If we have paid 80,000 ALL, that amount will be reimbursed. If we have paid more than 100,000 ALL, only 100,000 ALL will be reimbursed, not more,” explained accountant Armand Hasko.

How is the 48,000 ALL per child calculated?

Let’s take the example of a citizen with a gross monthly salary of about 80,000 ALL, earning a total of 960,000 ALL annually. The tax deduction applied under Article 22 currently in force is about 360,000 ALL per year.

The taxable amount from this annual income becomes 600,000 ALL. Applying the 13% tax rate results in an annual income tax of 78,000 ALL.

But how does the 48,000 ALL deduction apply, since many parents are confused and think this exact amount will be reimbursed?

“If this citizen with this gross salary has one child, under the current law the deduction from the taxable base will be 48,000 ALL. The taxable amount, as mentioned, was 600,000 ALL.

After subtracting the 48,000 ALL, the taxable base becomes 552,000 ALL. Applying the 13% tax rate, the citizen should pay 71,760 ALL in tax.

In this case, we calculate that the citizen has overpaid about 6,240 ALL compared to the tax already paid. This amount represents the benefit gained from the law that entered into force in 2026, after applying deductible expenses,” said Hasko.

While this calculation is done automatically in the tax system, how should one proceed to receive the refund?

“To receive the money in the bank account, a request must be submitted within three months after March 31 to the regional tax office to process the reimbursement. If the DIVA declaration shows an amount payable, the full tax is not paid, as the calculated benefit is deducted,” the accountant explained.

The tax system for individuals is expected to open on January 22, 2026, and the final deadline for submitting the DIVA declaration is March 31, 2026.

“KORÇA BOOM”