Which of the following can claim a deduction under section 129 of the Income-tax Act, 2025 for interest on a loan for higher education? Assume the taxpayer has opted out of the section 202 regime…
Question and options
Which of the following can claim a deduction under section 129 of the Income-tax Act, 2025 for interest on a loan for higher education? Assume the taxpayer has opted out of the section 202 regime and the lender is a bank.
An individual who took the loan for his nephew's higher education, not being his guardian
An individual who took the loan for his daughter's higher education
A Hindu undivided family that took the loan for a member's higher education
A company that took the loan for an employee's higher education
Answer and explanation
Section 129 allows the deduction only to an individual, for a loan taken for the higher education of himself or a 'relative', meaning his spouse, his children or a student for whom he is the legal guardian. A daughter is covered. A Hindu undivided family cannot claim, unlike under section 123, and a nephew is not a relative for this purpose unless the individual is his legal guardian.
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