Q: What are the things to keep in mind while claiming tax deductions u/s 80(E) against interest paid on education loan? – Karunakara
A: If you have taken education loan from a bank or a financial institution, you can claim tax deduction u/s 80(E) for the entire interest paid on such a loan. There is no threshold for claiming deduction u/s 80E. You can claim deductions against the repayment of interest under education loan for self, spouse, children, etc.
Sec 80(E) deduction is only available for education loan taken for higher studies. Also, only full-time courses are eligible for this tax deduction benefit.
Do note that Section 80E deduction can be claimed for a maximum of 8 years or till the entire outstanding amount is cleared, whichever earlier.
Keep the bank’s loan statement handy in your records if you want to claim deduction u/s 80(E). You may need to furnish such proof if you get a query from the IT department later.
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