Another Benefit in line to make get your child in for Higher Studies. Get an education loan and get tax benefit along with reducing the overall cost of the loan.
1. Under Section 80 E it is clearly mentioned that a person having an education loan will get a tax rebate for the interest paid (without any limitation as it used to earlier), and not an the Principal Amount, as the repayment of the loan for the first 8 years. Any loan above that time period will not get tax rebate after 8th year.
2. The tax benefit is given to only those people in whose name the loan has been taken, whether it is the person itself, or for spouse or for your children. It does not take into consideration the loan taken by elder brother or sister for the education of their siblings.
3. The loan taken by financial institutions or banks only give you the flexibility of tax reduction. Loans taken by family members, friends or employer doesn't add value in the tax reduction. Some charitable institution are also approved for the same by Govt. Of India.
4. Part time course loan are not included in tax benefit plan. Full time courses for Graduation or Post Graduation are included in the same.
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