Chartered Accountant · ICAI M.No. 153926 · FRN 136869W
Interest, with no cap
Section 80E lets you deduct the interest on an education loan with no monetary ceiling — the whole interest you pay in the year is deductible. Only the interest qualifies, not the principal repayment. The loan must be for higher education and taken from a bank or approved financial/charitable institution.
Who and how long
The loan can be for the higher education of yourself, your spouse, your children, or a student for whom you are the legal guardian. The deduction is available for up to 8 consecutive years from when you start repaying, or until the interest is fully paid if sooner. It is an old-regime deduction. Confirm the conditions per the Finance Act.
A worked example
Example: you repay an education loan with ₹1.2 lakh of interest this year — the entire ₹1.2 lakh is deductible under 80E (in the old regime), unlike the capped home-loan interest. Over the early years of a large loan, this can be a substantial saving. Keep the lender’s interest certificate as proof. Our team can fold it into your return.