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Thursday, May 7, 2015



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INCOME TAX EXEMPTION / DEDUCTION ON
INTEREST PAID ON EDUCATION LOAN

Press Information Bureau
Government of India
Ministry of Finance
05-May, 2015

            Section 80E of the Income-tax Act, 1961 provides that in computing the total income of an individual, their shall be allowed a deduction of the amount paid by way of interest on loan taken by him from any financial institution or approved charitable institution for the purpose of pursuing his own higher education or higher education of his spouse, or children, or the student for whom he is the legal guardian. The deduction is available for eight assessment years beginning with the assessment year in which the payment of interest on such loan is first made or until the interest is paid in full, whichever is earlier. This deduction is available to every individual who is liable to income-tax. No specific funds are earmarked for the purposes of extending tax concession against interest paid on education loan.
            This was stated by Shri Arun Jaitley, Union Finance Minister in written reply to a question in the Rajya Sabha today.
EXTRACT OF SECTION 80E OF INCOME TAX ACT 1961
            Under Section 80E of the Act a deduction will be allowed in respect of repayment of interest on loan taken for higher education, subject to the following conditions:

(i)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 spouse or children.

(ii)        The deduction specified above 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 above is paid in full by the assessee , whichever is earlier. For this purpose –

            (a) “approved charitable institution” means an institution established for charitable purposes and approved by the prescribed authority under clause (2C) of section 10, or, an institution referred to in clause (a) of sub-section (2) of Section 80G. Section 80E 35

            (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 any course of study pursued after passing the Senior Secondary Examination or its equivalent from any school, board or university recognised by the Central Government or State Government or local authority or by any other authority authorised by the Central Government or State Government or local authority to do so;

            (d) “initial assessment year” means the assessment year relevant to the previous year, in which the assessee starts paying the interest on the loan.

            (e) relative”, in relation to an individual, means the spouse and children of that individual or the student for whom the individual is the legal guardian
 Source: Press Information Bureau



POST RETIREMENT BENEFITS

 

     Department of Personnel & Training has not made any change in instructions contained in OM No. 22011/4/1998-Estt.(D) dated 12.10.1998 and reiterated vide OM No. 22011/1/2014-Estt.(D) dated 14.11.2014. These instructions provide for consideration of retired employees, who are within the zone of consideration in the relevant year(s) while preparing year-wise panel(s) for promotion. Such retired officials, however, have no right for promotion as they are not available to assume charge of the higher post. 

            This was stated by the Minister of State for Personnel, Public Grievances and Pensions and Minister of State in the Prime Minister’s Office Dr. Jitendra Singh in a written reply to a question by Dr. Udit Raj in the Lok Sabha today. 

Source: PIB Release, 06.05.2015

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