Deduction in Respect of interest of loan taken for higher education.

Deduction in respect of loan taken for higher education (Sec. 80E)

Eligible assessee: Individual

An individual is entitled to a deduction of amount paid by him in previous year by way of repayment of loan ( including interest) taken by from any financial institution or an approved charitable institution for the purpose of pursuing his higher education conditions.
i. The repayment should be done out of his income chargeable to tax.
ii. The deduction will be allowed for the previous year in which the assessee starts repaying the loan.
The deduction is available for a maximum period of 8 years till the loan together with inter thereon is fully paid (whichever is earlier) by the assessee.

Only interest is allowed not repayment of any installments.