Education Loan Interest Exemption

This query is : Resolved

Raviraj (Querist)
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24 January 2011 Dear Sir/Madam,

I have an education loan. Its EMI starting from Feb 2011. Since last 2 years my brother is paying its interest. Now onwards if my brother will pay EMI can he get interest exemption for FY 2010-2011?
If not, can I get exemption for same year?

CMA. Dinesh S Adhikari, ACMA

CMA. Dinesh S Adhikari, ACMA (Expert)
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25 January 2011 As per section 80E it has been mentioned that only that person can avail interest deduction who has taken loan and paid the same. Here becuase you brother paid the interest amount therefore as per my opinion neither he nor you cannot claim deduction of the same, but yes if you would be paying interest then you will be able to claim deduction.

Although let the other show their views on this point.

Regards!!!

CA Jeen paul

CA Jeen paul (Expert)
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25 January 2011 sec 80E is amended from the A.Y. new provision states as below

the loan was taken by the taxpayer for the purpose ofhis own higher education or for the purpose of higher education of his spouse,any child or student for whom the tax payer is the legal guardian.

in your case if your brother is your legal guardian the benefit of sec can be availed by your brother if he paid the EMI

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sachin

sachin (Expert)
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25 January 2011 As per reading of the section 80E to avail the benefit of deduction of interest on education loan
1.it must be owed by the individual or legal guardian.
2.And interest expenses must have paid out of that persons taxable income.
In your case loan is owed by you & interest expenses is paid out of taxable income of your brother which is contrary to the said provision of section 80E, hence neither you nor your brother can claim deduction u/s.80E.