Educational loan and its application in accounts
This query is : Resolved
13 January 2012
my client has availed an educational loan from the bank and he has been repaying the interest to that educational loan. Now i would like to know how it is shown in his books of accounts while he is filing his individual income returns ? the loan amount was directly paid by the bank to the concerned college authorities.
17 January 2012
Interest paid on education loan is allowed as deduction under Section 80E.
17 January 2012
sir i have not asked about tax treatment. i am asking about way of treatment in books of accounts of the assessee.
12 May 2012
Normally books of accounts are maintained for a business and transactions related to business are recorded in books of accounts.
Education loan is not related to business.
However, if you still want to record the same, entries will be as under:
1. Grant of Loan
Drawings A/c Dr
To Education Loan
2. Repayment
Education Loan A/c Dr
Interest on Loan A/c Dr
To Bank A/c
Education loan is not related to business.
However, if you still want to record the same, entries will be as under:
1. Grant of Loan
Drawings A/c Dr
To Education Loan
2. Repayment
Education Loan A/c Dr
Interest on Loan A/c Dr
To Bank A/c
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