Investment Declaration Guide

Investment declaration has to be done in the beginning of a financial year. Your employer asks you to declare your tax-saving investments for the year to be able to deduct tax accordingly from your monthly salary. Investment declaration is important for you because it can lead to higher in-hand salary. At the beginning of the financial year, you have to just make an estimate of the investments that you intend to make. You don’t need to submit actual proofs until the end of the financial year. You can actually invest less or more. The eventual investments don’t have to be exactly as declared.

Form 12BB

The Form 12BB is a statement of claims by an employee for deduction of tax. With effect from 1st June 2016, a salaried employee is required to submit the Form 12BB to his or her employee to claim tax benefits or rebate on investments and expenses. Form 12BB has to be submitted at the end of the financial year. Form 12BB applies to all salaried taxpayers.
Using Form 12BB, an employee has to declare the investments that they have made during the year. Documentary evidence of these investments and expenses have to be provided at the end of the financial year as well.

Sample Form 12BB

Generate Form 12BB

Investment declaration has to be made for the following tax-saving investments and expenses:

House rent allowance

• Rent to be paid to landlord along with name, address and PAN/Aadhaar number of the landlord

Know more about how to claim house rent allowance.

Leave travel concessions or assistance

• Leave travel concession or leave travel allowance as per salary package

Home loan interest

• Interest payable to lender along with name, address and PAN/Aadhaar number of the lender

Know more about deduction on home loan interest.

Deductions under Section 80C, 80CCC, 80CCD

• 80C: Premium to be paid for life insurance and/or investments to be made in ELSS funds, PPF, NPS and/or school tuition fees for children, etc
• 80CCC: Premium to be paid for annuity plan
• 80CCD: Additional contributions made to NPS

Know more about deduction under section 80C, 80CCC, 80CCD.

Deductions under other sections like 80E, 80G, 80TTA, etc.

• 80D: Premium to be paid for medical insurance
• 80E: Interest to be paid on education loan
• 80G: Donations to be made to specified organisations
• 80TTA: Interest income earned from savings bank account

Frequently Asked Questions

What is the purpose of investment declaration?

Employees have to submit a declaration of deductions and exemptions that they want to claim. The employer will deduct TDS on the employee’s salary on the basis of these declarations. These investments are generally required to be made on the employer’s HR portal.

When do I have to submit Form 12BB? 

Usually, employers ask for a declaration at the start of the financial year to estimate TDS calculations for the whole year. Form 12BB has to be later submitted towards the end of the financial year.

Do I need to submit Form 12BB to the Income Tax Department? 

No, Form 12BB does not have to be submitted to the tax department. It has to be submitted to your employer.

I could not declare my investments on time and my employer has deducted excess TDS. What should I do? 

You can claim refund of excess TDS deducted by filing your income tax return.

Download Investment Declaration Guide

Related links

Section 80D- Deduction on health Insurance premium
Section 80E- Deduction on interest of education loan
Section 80G- Deduction on donation
Section 80TTA- Deduction for interest earned on savings account