Several Income Tax Deductions are allowed to Salaried Employees for certain types of Investments and Expenses. The employee is required to furnish details and evidence of such investments and expenses to his employer to claim such income tax deductions.
Till now, there was no preset format in which such a declaration could be furnished by the employee to his employer for claiming such a deduction. However, the Income Tax Dept has now released Form 12BB which would be required to be furnished for claiming Income Tax Deductions. This new Form 12BB is applicable from 1st June 2016.
How to submit Form 12BB
The Employee would be required to submit Form 12BB to his employer for claiming the following:-
- HRA Exemption
- LTA Exemption
- Deduction for Home Loan Interest
- Section 80C Deductions for Investment in PPF, Tax Saving Fixed Deposit, Mutual Funds, National Savings Certificate and other specified Investments/ Expenditure under Chapter VI-A.
For claiming the above mentioned deductions, the employee would be required to mention the following particulars and attach the necessary evidence for the same.
| S. No. | Nature of Claims | Evidence or Particulars |
| 1 | House Rent Allowance | Name, Address and PAN No. of the Landlord where the aggregate Rent paid during the year exceeds Rs. 1 Lakhs |
| 2 | Leave Travel Allowance | Evidence of Expenditure |
| 3 | Deduction for Home Loan | Name, Address and PAN No. of the Lender |
| 4 | Section 80C and other Deductions | Evidence of Investment or Expenditure |
Apart from mentioning the above mentioned details, the employee would also be required to mention:-
- Name and Address of the Employee
- PAN No. of the Employee
- Financial year for which the Form is being submitted
- Date on which the declaration is being submitted
- Designation of the Employee
- Signature of the Employee
The Form 12BB can be downloaded from here:-
- Download Form 12BB in Excel Format
- Download Form 12BB in Word Format
- Download Form 12BB in PDF Format
Reason for Introduction of Form 12BB
Almost all employees claim one or more of the above mentioned deductions. For claiming any one or more of the above mentioned deductions – they are required to furnish proof of the same to their employer.
Till now, there was no standard process to collect all the proofs and information regarding the various deductions. With the introduction of Form 12BB, there would be a standardised process for the manner of collection of evidence and proofs for claiming such deductions.
With the introduction of this standardised Form 12BB, the income tax department expects that they would be able to plug leakages in tax evasion and tax frauds will go down.
Benefit of claiming these Deductions
These Deductions/ Exemptions reduce the total taxable income of the person and therefore the tax which is levied as per the income tax slab rates is levied at a lower rate. It is highly advisable that everyone makes use of these deductions to reduce his income tax liability.
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