What is form no 12bb? Why is form 12bb required?

What is form no 12bb?

Form 12BB is a statement of claims by an employee for deduction of tax. Salaried employee should fill the form and submit to his/her employee to claim tax benefits on investments and home loans. Form 12BB has to be submitted at the end of the financial year to employer.

Why is form 12bb required?

Form 12BB applies to all salaried taxpayers. Using Form 12BB, an employee has to declare the investments and claim tax benefits, 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. Unless we submit Form 12BB, all the investments under section 80C and home loan claims are not accepted. In case you forget to submit form 12BB to your employer within the prescribed time, the employer will not be able to give you benefit of deductions and other tax exemptions. As a result, excess TDS will be deducted from your monthly salary.

How to fill and submit Form 12BB?

Many organizations tax tool auto generates Form 12B once investment declared in the payroll portal. While submitting the investment proof, it would generate Form 12BB for download. Once it is available for download, we have to download, sign it and upload back to the employer to claim the tax benefits. Otherwise, follow the below steps and submit form 12BB to employer with investment proofs.

You can download the sample Form 12BB from the Income Tax Department website or hereitrform12bb.
Fill Personal Details i.e, Add your Name, Address, and PAN details. Also, mention the current financial year i.e 2020-2021.
If you are incurring any rental expenses for your work then that can be deducted under HRA.In the first part of Form 12BB, you can fill the details required to claim tax deduction on HRA. To claim HRA, you need to provide details such as:
- Name and address of landlord and actual rent paid.
- If the rent paid during the year exceeds Rs. 1 lakh, you also need to provide PAN of landlord.
- Rent receipts from landlords
- In case, if you are paying the rent by cash, you have to affix revenue stamp on the receipts.
Add details of LTA if any.
Interest payable to lender along with name, address and PAN of the lender
If you are paying any Interest on EMI of home loans in this particular Financial year it can avail you benefit up to 2,00,000 for self-occupied property and no limit on rented property

Income tax sections:

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
80E: Interest to be paid on education loan
80G: Donations to be made to specified organizations
80TTA: Interest income earned from savings bank account80D: Premium to be paid for medical insurance

It is important to do tax planning to save money on tax. Make sure you completed below 3 steps to claim tax benefits

Invest in section 80C investments, declare home loan principal repayment and collect Rent receipts.
Declare the investment and submit document proof to employer.
Submit Form 12BB to employer.

Step 3 is most crucial steps in claiming the tax benefits. Make sure you do not miss this step. Submit form 12BB to your employer and save on tax. Happy investing.