Education Loan - IT Deduction

Section 80 E - Income Tax Act, 1961:

Applicable to: Individuals

Deduction:

  • Interest paid on the loan for higher education
  • No, there is no limit.
  • PRINCIPAL is not allowed as deduction

Deduction available to whom?

  • To self or dependants - like spouse and children

Deduction Period:

  • This deduction is allowed for the initial year (Year of commencement of payment of interest) and immediately succeeding 7 A.Y.s
  • or
  • Until the interest is paid - WHICEVER IS EARLIER.  

 

Note: 'Higher education' means any full time course of graduate or post graduate course. After +2 full time course would be eligible for it. The study can be anywhere in the world and not necessary to be in India.