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Total Income

shibu (Accountant) (325 Points)

17 March 2011

An employee working in a Pvt Ltd company spends Rs.50000 for his eduction in a Govt Engineering college (evening batch) during the FY 2010-11. He also makes donation to a Mosque amounting to Rs.20000. Will he get deduction/ exemtion while computing his total income ? What documents the employer is required to verify while issuing his form 16 ?

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13 Replies

Shriram Ramachandran (IPCC Student CWA Inter & Processing officer in GNSA Infotech Ltd) (492 Points)
Replied 17 March 2011

For the education he has spend cant b claimed as deduction. But the donation given to Mosque can b claimed as deduction U/S 80G of Income tax act. For this the employee has to produce the donation receipt from tat Mosque.

Thanks & Regards

R Shriram

1 Like

Abhijeet Deshpande (Co-Founder & Manager @ Tax-Yantra) (1171 Points)
Replied 17 March 2011

Deduction for education can be claimed where the LOAN has been taken to persue such course and the interest amount paid during the fiscal is deductible u/s 80 E

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shibu (Accountant) (325 Points)
Replied 17 March 2011

Hai,

The employee spends for his education in a Govt College fully out of his salary income and he has not taken any loan for this purpose.

Shriram Ramachandran (IPCC Student CWA Inter & Processing officer in GNSA Infotech Ltd) (492 Points)
Replied 17 March 2011

Agree with Abhijeet but the employee must have taken loan & then only the Interest paid on tat loan is subject to deduction not the amount paid for his education

Thanks

R Shriram

Shriram Ramachandran (IPCC Student CWA Inter & Processing officer in GNSA Infotech Ltd) (492 Points)
Replied 17 March 2011

No deduction can b claimed U/S 80E.

Thanks

R Shriram

Abhijeet Deshpande (Co-Founder & Manager @ Tax-Yantra) (1171 Points)
Replied 17 March 2011

Interest on Loan is only deductible only. If no loan is taken as in your case, no deduction can be availed for the same.

(Guest)

tuition fees (excluding any payment towards any development fees or donation or payment of similar nature), whether at the time of admission or thereafter,—

(a) to any university, college, school or other educational institution situated within India;

(b) for the purpose of full-time education of any of the persons specified in sub-section (4);

in the case mentioned by you, the college is not fuul-time and hence deduction u/s 80C is not eligible....

And as far as the donation to mousque is considered, any sums paid by the assessee in the previous year as donations for the renovation or repair of any such temple, mosque, gurdwara, church or other place as is notified⁴¹ by the Central Government in the Official Gazette to be of historic, archaeological or artistic importance or to be a place of public worship of renown throughout any State or States; are deductible....

so, if it is a pure donation not eleigible for deductions....

corrections and clarifications are welcome....

shibu (Accountant) (325 Points)
Replied 17 March 2011

Dear All, Mr.Subramaya bhagirath is telling that if the Course is full time, eligible u/s 80C.

Let me tell you that the employee is attending evening batch and no difference is found in the certificate issued by the university for similar course during day time. What is the factor to determine whether the course is full time or not ?

(Guest)

Dear Shibu,

In Income-tax act there is no definition for full-time education...

It is simply written to mean " full-time education is that which is not part-time"... So here are some definitions and discussions compiled for ur perusal.,

The following discussions might help u understand about the distinction between full-time and part-time educations...

Discussion 1:- ( income-tax website)

Income tax Act provides two types of deduction for education . These are

Tuition fee paid for children u/s 80C subject to maximum Rs 1,00,000.
Interest on education loan for studies of self or spouse of children without any limit u/s 80E

Now the question raised is :whether correspondence or distance education is covered under those sections of the I T Act for thr purpose of claiming deduction? Let us see what is the meaning of "studies" for the purpose of section 80C and 80 E.
Section 80C(xvii) provides as under
(xvii) as tuition fees (excluding any payment towards any development fees or donation or payment of similar nature), whether at the time of admission or thereafter,

(a) to any university, college, school or other educational institution situated within India;
(b) for the purpose of full-time education of any of the persons specified in sub-section (4);
Section 80E
Subsection 3 of section 80E defines education in following words
(c) higher education means full-time studies for any graduate or post-graduate course in engineering, medicine, management or for post-graduate course in applied sciences or pure sciences including mathematics and statistics;
As can be seen the wording , in both the provisions put stress on "full time "education or studies which means that the course should not be "part time" . There is no distinction by delivery mechanism of imparting education. Distance education is different from the regular course is that the delivery of education may be a combination of ways-postal,electronic and class room. So, in my opinion , if the education is not "part time" , the deduction u/s 80C is claimable for all modes of getting education-whether it is correspondence or electronic or a combination of medium of delivery.

Discussion 2:- (committee for higher education - india)

To be considered a full-time student, high schools, trade schools, and vocational schools generally require 25 or more actual clock hours of classroom attendance each week. Colleges and universities generally require a enrollment for a minimum of 12 credit hours per semester to be considered full-time.

Discussion 3:- (general ideology).

In general terms full-time education is to mean that the person should devote his entire time on education only...

Hope u r doubts are clarified atleast to some extent....

<<<<<suggestions and clarifications are invited>>>>

(Guest)

So Dear Shibu,

If the person as per ur doubt satisfies the criteria of the required credit hours per semister or credit hours per week, then he might be eligible to deduct the tution fees irrespective of the time-table of the classes ...

regards

bhagirath ks