CA Sameer Shaikh’s Post

HELLO FOLKS, Let us understand education loans and how to avail of tax benefits on education loans under Section 80E. A sum of money borrowed to cover higher education-related costs is known as an education loan. Higher education includes MBA, MBBS, CA, and Ph.D. B.Tech., etc. The purpose of an education loan is to help pay for living expenses throughout a borrower’s time of study and the cost of tuition fees, admission fees, books, supplies, etc. You can only get a deduction from the interest amount, not the principal amount. You can claim only if the loan was taken for higher education purposes. This loan must be taken from recognized financial institutions (which means a banking company) and approved charitable institutions Self, spouse, children, and a person for whom the assessee is a legal guardian can claim a deduction on interest payment on an education loan. If the loan is taken from a family member a relative or an unrecognized institution, it will not be allowed as a deduction. You can claim the entire amount of interest; there is no limit. This deduction for interest on a loan starts from the year in which you start repaying the loan. You can claim a deduction for a maximum of 8 years from when you start and until you start repaying the loan or until the interest is fully repaid, whichever is earlier. For example, if you complete the repayment of the loan within 6 years, then tax deductions will also be allowed for 6 years only. This tax benefit is available under the old tax regime only, not under the new tax regime. #educationloan #highereducation #studyloan #personalloan #studentloans #overseaseducationloan  #educationconsultant #educationmatters #taxation #tax #taxes #accounting #incometax  #taxplanning #taxreturn #taxtips #taxconsultant #taxpreparation  #taxhelp  

Can I get Tax Benefit on an education loan?🤔 An education loan helps you not only finance your higher studies but it can save you a lot of tax as well. You can avail tax benefits on the repayment of education loans under Section 80E of the Income Tax Act. ✅Loan for whom: This deduction is available for the interest paid on loans taken for higher education for yourself, your spouse, children, or for a student for whom you are the legal guardian. ✅Deduction Amount: You can claim the entire interest amount paid during the financial year as a deduction. The principal repayment amount does not qualify for a deduction. If your GTI after other deductions is Rs 6.7 lakh and you repay Rs. 2,00,000 as the interest component of the education loan, your total income would become Rs 4.7 lakh. ✅Period of Deduction: The deduction is available for a maximum of 8 years starting from the year you start repaying the loan or until the interest is fully repaid, whichever is earlier. ✅No Upper Limit: Unlike some other sections of the Income Tax Act, there is no upper limit on the amount that can be claimed as a deduction under Section 80E. ✅Loan from Banks/Financial Institutions: The loan should be taken from a financial institution or approved charitable institution to qualify for this deduction. ✅Loan for Higher Studies Only: You will be eligible to claim education loan deduction only if it is taken for pursuing higher studies. It does not matter whether such an education loan is taken for higher studies in India or outside India. Follow Fincart Financial Planners for more finance related content. 📢If you need assistance in tax planning, connect with our financial advisor. (Link in first comment below)

🌱Benefits of investing under income tax series Day 4 : Interest on educational loan Income tax benefits on interest paid on education loans are designed to incentivize individuals to pursue higher education by making it financially more feasible. Here are the detailed benefits: 📍1. Deduction under Section 80E: In India, individuals can claim a deduction for the interest paid on an education loan under Section 80E of the Income Tax Act. This deduction is available only for the interest component of the loan repayment and not for the principal amount. 📍2. Eligibility: The deduction is available to individuals who have taken an education loan for themselves, their spouse, or their children. It can be claimed for full-time or part-time courses pursued in India or abroad. 📍3. No Upper Limit on Deduction Amount: Unlike other sections of the Income Tax Act, there is no upper limit on the amount of deduction that can be claimed under Section 80E. This means individuals can claim the entire interest paid during the financial year as a deduction from their taxable income. 📍4. Conditions: To claim the deduction, the loan must be taken from a financial institution or approved charitable institution. The loan should be for the purpose of higher education pursued by the individual, their spouse, or children. The deduction is not available for loans taken for other purposes, such as living expenses or buying assets. 📍5. Claiming Deduction : Individuals can claim the deduction while filing their income tax returns. They need to provide details of the interest paid on the education loan, including the name and address of the lender, the amount of interest paid, and the loan account number. 📍6. Lower Tax Liability: By availing of this deduction, individuals can reduce their taxable income, thereby lowering their overall tax liability. This can result in significant savings, especially for those repaying high-interest education loans. Overall, the income tax benefits on interest paid on education loans serve as a supportive measure to encourage individuals to invest in education and skill development, ultimately contributing to personal growth and the nation's human capital development.

𝐃𝐨 𝐲𝐨𝐮 𝐰𝐚𝐧𝐭 𝐲𝐨𝐮𝐫 𝐜𝐡𝐢𝐥𝐝 𝐭𝐨 𝐤𝐞𝐞𝐩 𝐩𝐚𝐲𝐢𝐧𝐠 𝐞𝐝𝐮𝐜𝐚𝐭𝐢𝐨𝐧 𝐥𝐨𝐚𝐧𝐬 𝐭𝐢𝐥𝐥 𝐭𝐡𝐞𝐲 𝐚𝐫𝐞 𝟏𝟎𝟎? 𝐍𝐨. Then, you need to read this. The education scene has changed dramatically over the years. The cost of education, especially higher education, is increasing. An August 2023 Report by BankBazaar showed that over the last decade, the inflation rate in education was around 11-12%, almost double that of consumer price inflation (CPI) at 6%. So, if you are a parent or planning to have kids, you must start building an education fund for your children as early as possible. But how can you start? 𝐇𝐞𝐫𝐞 𝐚𝐫𝐞 𝐟𝐢𝐯𝐞 𝐞𝐚𝐬𝐲 𝐬𝐭𝐞𝐩𝐬 𝐭𝐨 𝐠𝐞𝐭 𝐬𝐭𝐚𝐫𝐭𝐞𝐝. 1️⃣ Start Early: The earlier you start investing, the more your money can grow. All thanks to compounding. 2️⃣ Calculate the future cost: Next, estimate the cost of higher education considering inflation. In addition to tuition fees, you must estimate the cost of living, such as rent, food and transportation. You can use online calculators to estimate the amount of money you need to invest monthly. 3️⃣ Choose the Right Investment Option: The right investment option depends on how much time you have left to achieve this goal. If your kids are in primary school, you have more than ten years to plan for their higher education. Here, you can allocate a higher proportion to equity-oriented mutual funds as these funds can potentially deliver higher returns over the long term. 4️⃣ Systematic Investment Plan (SIP): After choosing the mutual fund of your choice and the amount you can invest every month; the next step is to start an SIP where the fixed amount will be invested automatically every month. 5️⃣ Review and Rebalance: You need to regularly review your plan and adjust your investments as you get closer to your goal.   Have you started investing in your kid's education? Do let us know. Mutual Fund investments are subject to market risks, read all scheme related documents carefully. #highereducation #financialplanning #mutualfunds #SIP

Do you want to help your children save for their future? The RESP is one way to help prepare your loved ones for University or College, and the proper strategies and structuring of investments within the RESP could lead to the difference between needing student loans or having a fully funded education. Message us today if you would like to learn more about how to maximize the benefits of the RESP for your loved ones. #BackToSchool #RESP #ScotiaWealthManagement #EducationPlanning #TotalWealth #FinancialPlanning #Investing

Major Relief for Students' HECS (Higher Education Contribution Scheme) Debts! I'm delighted to hear about the government's decision to backdate relief for HECS-HELP, VET Student Loan, Australian Apprenticeship Support Loan, and other student support loan accounts, starting from June 1, 2023. The announcement that an individual with an average HECS debt of $26,500 could see around $1200 wiped from their outstanding loans is fantastic news. This relief will alleviate their ongoing financial burdens. Moreover, the substantial relief for students with larger debts, such as $100,000 or more, is particularly commendable. Those who have pursued costly degrees like medicine or law, or those who have undertaken multiple degrees, could see up to $5000 wiped from their debts. Let's continue to advocate for policies that empower students, foster lifelong learning, and build a stronger, more inclusive education system for the future. #HECSDebtRelief #EducationEquity #EmpoweringStudents #InvestInEducation #HigherEducationAccess

Major Relief for Students' HECS (Higher Education Contribution Scheme) Debts! I'm delighted to hear about the government's decision to backdate relief for HECS-HELP, VET Student Loan, Australian Apprenticeship Support Loan, and other student support loan accounts, starting from June 1, 2023. The announcement that an individual with an average HECS debt of $26,500 could see around $1200 wiped from their outstanding loans is fantastic news. This relief will alleviate their ongoing financial burdens. Moreover, the substantial relief for students with larger debts, such as $100,000 or more, is particularly commendable. Those who have pursued costly degrees like medicine or law, or those who have undertaken multiple degrees, could see up to $5000 wiped from their debts. Let's continue to advocate for policies that empower students, foster lifelong learning, and build a stronger, more inclusive education system for the future. #HECSDebtRelief #EducationEquity #EmpoweringStudents #InvestInEducation #HigherEducationAccess

Investing in your child's education is an investment in their future. Since self-funding isn't always feasible, understanding education loans is crucial. These loans provide benefits such as tax deductions and can help instill financial discipline in your child. Key considerations include interest rates, career prospects, and budgeting. Careful planning is essential, as poorly managed educational loans can lead to significant financial strain. https://lnkd.in/dQQtihfF #EducationLoans #TaxBenefits

Managing finances during college can be challenging, but establishing a budget is a crucial step toward financial stability. For Muslim college students, integrating Islamic financial principles into their budgeting practices adds an extra layer of conscientiousness. In this article, we'll explore five practical budgeting tips for college students, enriched with Islamic financial wisdom. Create a Realistic Budget: Begin by outlining all sources of income, such as scholarships, part-time work, or financial support from family. Next, list all anticipated expenses, including tuition, housing, food, and other necessities. Allocate funds for each category and strive to live within your means. Islam encourages moderation and responsible spending, emphasizing the importance of avoiding extravagance. Prioritize Needs over Wants: Distinguishing between needs and wants is fundamental in both budgeting and Islamic finance. Prioritize essential expenses, such as education-related costs and basic living necessities, over discretionary spending on non-essential items. This aligns with the Islamic principle of avoiding unnecessary extravagance and practicing contentment with what is essential. Avoid Interest-Based Debt: Islamic finance prohibits the payment or receipt of interest (Riba). As a result, college students are encouraged to steer clear of conventional loans that involve interest. Explore alternative financing options, such as scholarships, grants, or interest-free loans, whenever possible. This aligns with Islamic teachings that emphasize ethical financial practices and discourage transactions based on exploitative gains. Embrace Barakah (Blessings) in Spending: In Islamic finance, there is a concept of Barakah, which refers to the blessings and prosperity that come from Allah. When budgeting, strive to seek Barakah in your spending by making ethical and responsible financial choices. Give to charity (Sadaqah) when possible, as Islam encourages generosity and sharing one's wealth with those in need. Plan for the Future: While college life may be a temporary phase, planning for the future is crucial. Save a portion of your income for future expenses, emergencies, and long-term goals. Islam places great importance on saving and investing responsibly. Consider ethical investment options that align with Islamic principles, avoiding industries such as gambling, alcohol, or those involved in unethical practices. Conclusion Budgeting as a college student, especially one with an Islamic financial perspective, requires a thoughtful and disciplined approach. By creating a realistic budget, prioritizing needs over wants, avoiding interest-based debt, embracing the concept of Barakah, and planning for the future, Muslim college students can navigate their financial journey with integrity and in accordance with Islamic principles. Remember, financial discipline is not just about managing money; it's also about aligning your financial choices with your values.

6 Ways to Pay for College Paying for college can feel overwhelming, but there are plenty of options to help with tuition and other costs. 💲🎓 Let's look at six ways you can make it happen: 1. Scholarships These are financial awards that you don’t have to repay! Earn them through academic or athletic achievements. 2. Grants Like scholarships, grants don’t need to be repaid. They’re often based on financial need or merit. 3. Federal Student Loans These loans come with lower interest rates and flexible repayment plans. Apply through FAFSA! 4. Private Student Loans If you’ve maxed out your federal aid, private loans are an option—but they often have higher interest rates. 5. Work-Study You can work part-time while studying to help pay for your education through this need-based program. 6. Savings Start a savings plan like a 529 or other investments to reduce what you’ll need to borrow later. By exploring these options, you’ll find the right mix of financial aid to pay for college and achieve your educational goals. 👇 For more insights: 💡 Follow me 👍 Like my post 💬 Leave a comment 💡 Click below to watch my video on Successful Money-Saving College Tips Universities Don’t Want You to Know: https://lnkd.in/efc9Cp8A 💡 Click below to book your 1-on-1 strategy session: https://lnkd.in/eMdCH_xH #tuition #college #scholarship #money #retirement #financialaid #grants