Salaried employees must need to disclose all their investments to their employer so that they can claim all the applicable tax tax rebate during efiling income tax. This form was introduced in June, 2016 by the Government and need to be filled and submitted to the employer by all salaried employees. The form must be submitted by the beginning of a Financial year with declaring all the investments done that are eligible to lower that taxable income. The employer must deduct TDS from the employee’s salary with referring this form.
This form is used to declare investment information with the employer so that the employee can get all the eligible deductions during efiling income tax. The investments include HRA (House Rent Allowance), LTA (Leave Travel Allowance), Home loan interest and all Section 80 Deductions must be shown in this form. These declarations also require appropriate proofs to be produced with it. For HRA claim, one must produce name, address, PAN details of the landlord if yearly rent exceeds the limit of INR 1 lakh. For LTA claim, all travel bills, receipts and all other expenses must produce with appropriate bills. To make home loan deductions assured during efiling income tax, one must produce Name, address and PAN of the lender in the Form 12BB. To declare any investments that fall under Section 80, one must produce investment evidences in proper format.
Investment declarations are must to get an appropriate tax deduction for a financial year. The declarations you will be making in this form 12BB is important as your employer will calculate and deduct TDS according this only. If you do not declare all the investments in this form than you might have to pay excess tax by the end of the financial year. Also, declaring investment is not the end point, you must claim refund for the excess tax and TDS with efiling income tax by the end if the financial year.