Income Tax exemption on Education Loans

Income Tax exemption on Education Loans under Income Tax Rule Section under 80E.
The entire amount of interest that you pay on your education loan is deductible from your total income.
There is a deduction for entire amount of interest paid on a loan taken for pursuing higher education for self and kids or spouse. Entire interest amount is deducted from the taxable income without any upper limit. This benefit under section 80E is available, assessee starts paying the interest on the loan and it continues upto eight years.
Income Tax Act, 1961 – Section 80E :-
“For section 80E of the Income-tax Act, the following section shall be substituted with effect from the 1st day of April, 2006, namely:—
Deduction in respect of interest on loan taken for higher education.
In computing the total income of an assessee, being an individual, there shall be deducted, in accordance with and subject to the provisions of this section, any amount paid by him in the previous year, out of his income chargeable to tax, by way of interest on loan taken by him from any financial institution or any approved charitable institution for the purpose of pursuing his higher education or for the purpose of higher education of his relative.
The deduction specified in sub-section shall be allowed in computing the total income in respect of the initial assessment year and seven assessment years immediately succeeding the initial assessment year or until the interest referred to in sub-section is paid by the assessee in full, whichever is earlier”.
For the purposes of this section,—
(a) “approved charitable institution” means an institution specified in, or, as the case may be, an institution established for charitable purposes and notified by the Central Government under clause (23C) of section 10 or an institution referred to in clause (a) of sub-section of section 80G;
(b) “financial institution” means a banking company to which the Banking Regulation Act, 1949 (10 of 1949) applies (including any bank or banking institution referred to in section 51 of that Act); or any other financial institution which the Central Government may, by notification in the Official Gazette, specify in this behalf;
(c) “higher education” means full-time studies for any graduate or post-graduate course in engineering, medicine, management or for post-graduate course in applied sciences or pure sciences including mathe-matics and statistics;
(d) “initial assessment year” means the assessment year relevant to the previous year, in which the assessee starts paying the interest on the loan.