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Everything employers and employees need to know about Form 12BB
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.
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.
Investment declaration has to be made for the following tax-saving investments and expenses:
Know more about how to claim house rent allowance.
Know more about deduction on home loan interest.
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.
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.
No, Form 12BB does not have to be submitted to the tax department. It has to be submitted to your employer.
You can claim refund of excess TDS deducted by filing your income tax return.