Everything employers and employees need to know about Form 12BB
Investment declaration is normally done at the start of the financial year. You are asked to declare your tx saving investments for the coming year so your employer can deduct tax from your monthly salary. By declaring your investments you can get higher in-hand salary.
You just have to make an estimate of the investments that you intend to make at the beginning of the year. As for the actual proof of investment, it can be submitted at the end of the year. It is not necessary for you to actually invest the exact amount you have declared at the beginning of the year.
Form 12BB is a statement of claims by the employee for the purpose of dedcution of taxes, As of 1st June 2016, all salaried employees are required to submit their Form 12BB to their employer for the purpose of claiming tax benefits or rebates on investments and expenses. The form is submitted at the close of the financial year.
The employee must declare all their investments through the financial year in the Form 12BB. The employee must also provide documentary proof of these investments at the end of the financial year.
80G: Donations to be made to specified organisations
80TTA: Interest income earned from savings bank account
80D: Premium to be paid for medical insurance
4. Frequently Asked Questions
I. 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.
II. 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.
III. 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.
IV. 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.