Starting in March 2026, parents with children under the age of 18 will benefit from a new tax compensation measure aimed at supporting Albanian families and easing the financial burden of raising and educating children.

According to amendments to the income tax law, each parent with dependent children under 18 will be entitled to deduct 48,000 lekë per child from their taxable base when filing the Individual Income Declaration (DIVA) for the 2025 fiscal year, which is submitted in March 2026.

This deduction is used to recalculate the tax paid during the previous year, and if it is determined that more tax was paid than required, parents may request a refund of the difference.

In addition to the child-related deduction, the law also provides for the deduction of education-related expenses of up to 100,000 lekë per year for families with annual incomes of up to 1.2 million lekë, provided that documentation of education payments is retained and submitted as proof.

The tax relief applies to all parents who file an income declaration. In two-parent households, the parent with the higher income benefits from the deduction for each dependent child. Even if a parent was employed for only part of the year, they may still benefit from the compensation if they meet the eligibility criteria.

To maximize the benefit from this measure, it is important to keep records of education-related payments and carefully include them in the annual income declaration, in accordance with the rules of the Tax Authority.