Tax deduction under 80 E

This is Indranil. I had taken higher education loan from SBI for an amount of Rs.3,83,000. I started repaying in FY 10-11, and have paid back Rs. 1,40,000 so far. The interest amount is approx. Rs.1,20,000 in all, out of which around Rs.30,000 is the current year interest and Rs.90,000 is arrears of interest, accumulating from 2006-2010. I got a certificate from SBI about my repayment which says: Arrears of interest: Rs.90,000 Current Year interest: Rs.30,000 Principal amount: Rs.20,000 Total: Rs.1,40,000 Am I eligible for tax benefit on the entire interest amount of Rs.1,20,000 or only on the current year interest amount of Rs.30,000? Please let me know! Thanks in advance.

  • Indranil

asked Feb 07 '11 at 07:57 by Indranil 1112

As per section 80E, the deduction amount is the interest paid on the loan of higher studies in the year and there is no limit on it.
Income tax act is not clear if interest amount can be carried forward too. In financial terms, silence is approval, so you may claim for full interest payment done this year (1,20,000) for tax deduction.

answered Feb 07 '11 at 13:30 by Pankaj Batra 5.2k320


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Asked: Feb 07 '11 at 07:57

Seen: 2,317 times

Last updated: Feb 07 '11 at 13:30