DEDUCTION OF INTEREST ON EDUCATION LOAN IN INCOME TAX ACT

[KASTURI SETHI]

Dear Experts,

One query please.

Is deduction on account of interest on education loan admissible under Income Tax Act ? If so, under which Section of Income Tax Act ? Pl. reply.

Thanks a lot in advance.

AI Summary

Interest Deduction on Education Loans Explained: Section 80E Covers Only Interest, Not Principal; No Deduction Limit. An individual inquired about the deduction of interest on education loans under the Income Tax Act. An expert clarified that such deductions are allowed under Section 80E, applicable only to the interest portion of the EMI, not the principal. The conditions for claiming this deduction include the loan being from an approved charitable or financial institution and for higher education. The deduction is available for the initial assessment year and the next seven years or until the interest is fully paid. Another expert added that education loans can be for the taxpayer or their relatives. There is no limit on the deduction amount.