Deduction u/s 80E

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This query is : Resolved

VVRMurthy (Querist)

30 June 2009 Interest paid on Loan for higher education of self or relative is permitted to be deducted from total income u/s 80E.
As per the model terms suggested by IBA, parent of the student will be a co-borrower of loan for higher education of the student.
Banks issue certificate at the end of each financial year showing the amount received towards principal and inerest. A typical bank certificate shows names of both the borrowers. But the banks generally will not be in a position to issue separate certificates for the amounts paid by each of the co-borrowers.
In the above circumstances, how can an assessee claim deduction, especially after the student secures a job.
What is the documentary evidence to be obtained by an employer before deducting the interest from the salary of an employee for the purpose of TDS.
Are there any guidelines of I.T. Dept in this regard.

Venkat Rao Marella

Venkat Rao Marella (Expert)

01 July 2009 The employee needs to satisfy the employers with the necessary proof of payment of Interest directly from his account and the payment is not made by the co borrower.

Parveen Bansal

Parveen Bansal (Expert)

01 July 2009 Submit certificate from bank for issue / clearance of cheque for payment of interest.

Please note that deduction is permitted only if payment of inteest is out of income.

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