Can I claim 80E if I studied abroad and the loan was taken in India?

Yes. The deduction is available for education pursued anywhere in the world, as long as the loan itself is from a recognised Indian bank, financial institution, or approved charitable trust. Where you studied doesn't matter; where you borrowed does.

What if my loan repayment goes beyond 8 years?

You can only claim the deduction for the first 8 years from the year repayment begins. Any interest paid after that, in years 9, 10, and so on, is not eligible. This is why keeping the tenure within 8 years, where feasible, is worth planning for.

Is there a maximum limit on the interest that I can deduct under Section 80E?

There is no upper limit. Unlike u/s 80C, which maxes out at ₹1.5 lakh, u/s 80E you can deduct the full interest amount paid during the financial year, whether that's ₹50,000 or ₹3 lakh. The higher your loan and interest outgo, the bigger the potential tax saving.

Can I claim an education loan interest deduction under the new tax regime?

No. The new regime comes with a lower tax slab rate but removes several deductions and exemptions. Section 80E is one of them. You can only claim deductions under Section 80E with the old tax regime.

Are Sections 80E and 80C connected?

No. Section 80E is not a part of Section 80E deductions. Simply put, Section 80E lets you claim deductions against a loan taken for the higher education of the child. On the other hand, you can claim tuition fees paid under Section 80C. Also, Section 80E has no ceiling on the maximum claim amount, whereas Section 80C comes with a ₹1.5 lakh limit.

How to Claim Deduction on Education Loan Interest (Section 80E)?

Learn how Section 80E lets you claim deduction on education loan interest paid.

JioFinance Team

7 mins read · 25 Jul 2026

How to Claim Deduction on Education Loan Interest (Section 80E)?

Claim a tax deduction on the entire interest paid on your education loan under Section 80E, with no upper limit, if you opt for the old tax regime.
The deduction is available for up to 8 years from the year you start repaying the loan, or until the interest is fully repaid, whichever is earlier.
Only interest qualifies for deduction—the principal amount is not eligible. The loan must be for higher education and taken from a bank, NBFC, or approved charitable institution.
Keep your interest certificate, loan sanction letter, and repayment records ready to claim the deduction while filing your ITR.
Compare the old and new tax regimes before filing, as Section 80E benefits are available only under the old regime. JioFinance can help estimate your tax liability and simplify ITR filing.

Most people finish repaying their education loan without ever realising they left years of tax savings on the table. Not because the rule is obscure (Section 80E has been around for decades), but because nobody really explains it in plain language. So here's the honest version: if you're paying interest on an education loan right now, that interest amount can be knocked straight off your taxable income. No cap. No ceiling.

If you're a parent who has taken or is planning to take a loan for your child's degree, this applies to you, too. This guide explains Section 80E and how you can claim the education loan tax deduction.

Income Tax Act, 2025: A Quick Update

In 2025, the New Income Tax Act 2025 was announced, which replaced the Income Tax Act, 1961. The new rules will be implemented from FY 2026-27. The education loan interest that earlier came under Section 80E will now be under Section 129 under the Income Tax Act 2025.

What Does Section 80E Actually Mean?

Here is an example for better understanding. Say your taxable income is ₹8 lakh and you paid ₹1 lakh in education loan interest last year. Under Section 80E, your taxable income drops to ₹7 lakh. That's it. No complicated formula, no partial limits like in Section 80C (renumbered as Section 123). You can claim the complete interest amount without any upper cap.

The catch is that this deduction only works under the old tax regime. The new regime offers lower slab rates but strips away most deductions, including this one. So before you decide which regime to file under, you genuinely need to run the numbers.

A few things that determine whether you can claim it:

The Loan Must be for Higher Education

Loan borrowed for any full-time course after Class 12, whether it's engineering, medicine, an MBA, or even a vocational programme. India or abroad, both count.

The Loan From a Bank, NBFC, or Charity

The loan should come from a bank, NBFC, or an approved charitable institution. Borrowed from your uncle or employer? That won't qualify.

Only Interest Can be Claimed

Only the interest component of your EMI is deductible. The principal isn't.

The benefit of the Section 80E deduction of interest on an education loan is for individuals only. HUFs and companies can't claim it.

The 8-Year Window: Don't Waste It

The deduction can be claimed from the year you start repaying and runs for up to 8 consecutive years, or till the time the interest is paid off completely, whichever is first. So if you clear the loan in 5 years, you get 5 years of deductions. If your tenure is 10 years, you only get the first 8.

Here's what most borrowers miss: many education loans come with a moratorium period, which is mostly the course duration plus a year. During this time, you do not have to pay the EMIs. But if you voluntarily start paying the interest during this period, your 8-year clock starts then, not later. Starting early isn't just financially prudent; it directly extends how long you can claim the deduction.

One more thing worth knowing: if two parents are jointly repaying the loan, both can claim deductions on their respective shares of the interest paid. They just can't claim the same rupee twice.

Tip: You can make use of the JioFinance application to check your tax liability by providing investment, insurance, and income details. Further, you may also file ITR online through JioFinance.

Documents Needed to Claim Section 80E Deductions

Filing 80E deduction of interest doesn't require submitting a mountain of documents. But you do need to have these ready in case of scrutiny:

Interest certificate from your lender, showing the split between principal and interest for the year
Loan sanction letter confirming the purpose and institution
Bank statements or a repayment schedule as supporting proof

The interest certificate is the critical one. Without it, you won't know the exact interest figure to declare, and your bank should issue it annually on request.

Conclusion

Section 80E is a real, substantial deduction that many individuals simply don't claim because the paperwork feels unclear or the regime comparison is complicated. Neither of those things needs to be true anymore. Get your interest certificate from your bank, take assistance from JioFinance to compare and understand which regime works better for you, and claim it in your ITR. A loan that funded your future shouldn't cost you more tax than it needs to.