Form 12BB – New Form to claim Income Tax Deductions by Employees

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• Dear Sreekanth

  i want to know that in respect of Leave travel Concession and deduction of interest under the head "income from house property" whether employee need to submit the respective document at the time of submission of form 12BB or at year end.
  and if employee sumbit respective document at year end then can employer claim exemption.

  can you share your mobile no. if possible

  Thanks in advance

  • Dear Sunil..It depends on your employer's policies. I believe that you can submit Form 12BB now and the documentary proofs at the year end. Kindly check with your employer too.

• >>It is also been made mandatory to submit documentary evidence of your investments / expenditures.

  It doesn't say when. So it will be useless to say that you have to do it as soon as possible to support your tax deductions for the rest of the year.

  Also, that is why the Form 12 BB itself says evidence/ particulars. & not only evidence. if the legislative intent is to furnish only evidence then it wouldn't have used the word "particulars".

  As per section "26C: Furnishing of evidence of claims by employee for deduction of tax under section 192" Says:

  "As per the new income tax rules the employees are now required to furnish certain evidence or particulars of the claims or deductions to the employer. The same are to be considered by the employer during the course of calculation of salary income of the respective employees and estimation / determination of Income Tax / TDS liability thereon. Such evidence or proof or supporting details or particulars are now required to be submitted by the salaried employees in new Income Tax Form 12BB, in respect of following claims for deductions"

  Also in the following cases(and many more) one cannot expect from an employee to furnish proof of savings immediately:-

  -LIC premium can be paid at the due date only ( if it is due in the Feb 17 why pay now).
  -Employees claiming exemption in case of school fees of children
  -Claiming benefit of interest or principal re-payment of Home loan etc.
  -Also in claiming benefit of Leave Travel Assistance (LTA), do you think employee needs to under take journey and furnish proofs of travel now.

  So, it is very much clear that employees need to furnish particulars that state the nature of evidence which can be furnished in Form 12 BB now, and proofs later on (obviously before the end of financial year).

  • Dear Jagatveer..thank you for sharing your viewpoint, which I believe is logical & acceptable.

    • Please remove this line from your blog as it is misguiding and people in my company are actually following the same without going to the details themselves.
      "It is also been made mandatory to submit documentary evidence of your investments / expenditures."

      You can just guess how irritating it is for me because I am an engineer and doing the research that they should do.

      So even if it is important for you to reflect your view point of the theory, please write it so (don't call it a mandate). Or present both sides of the coin and let people decide.

      It will be very appreciated if you update the blog, because I have checked with many companies like IBM, Quark etc and they all are going by the same old fashioned tax declaration stuff. Yes the new thing is the form which they obviously use.

      • Dear Jagatveer,
        Kindly go through the below sentences which are copied from The Finance Bill, 2015.
        “Section 192 (2D) : The person responsible for making the payment referred to in sub-section (1) shall, for the purposes of estimating income of the assessee or computing tax deductible under sub-section (1), obtain from the assessee the evidence or proof or particulars of prescribed claims (including claim for set-off of loss) under the provisions of the Act in such form and manner as may be prescribed.”.
        Kindly let me know your views.
        This is a compliance requirement. So, it is up to an employer to follow it or not.

        • It doesn't say when you have to submit the evidence of the investments for tax benefits.

          The point is simple, follow that has been said to change. Where there is no change mentioned in the writing, it's actually wrong to just assume it and start following it. For example, Government wants us to use the new form 12BB, fine we should use it.

          Similarly, Government has not mentioned anywhere that you have to give the evidence of the investments in the beginning . So we should definitely not let our imaginations run wild.

          That is why the Form 12 BB itself says evidence/ particulars. & not only evidence.

        • So, the sentence in the blog - “It is also been made mandatory to submit documentary evidence of your investments / expenditures" is ok, am i right?
          As it talks about proofs and does not say about the time-line.
          As mentioned in my previous comment, it is up to an employer to adhere to the compliance requirement or not.

        • Ok, I guess you are enjoying it too. However, just when you clarify the line from your blog, you have given another controversial statement.

          "it is up to an employer to adhere to the compliance requirement or not."

          If there is any tax laws updates, it's mandatory for everyone to adhere to it if it applies to you/your business/income(obviously if taxable).

          So it being up to the employer if something applies to their kind of business is wrong.

          12BB is to be applied, no doubt. However, evidence is to be submitted as and when they are done(before financial year end)

        • Dear Jagatveer,
          I am only trying to point out that 'evidence needs to be submitted' in the prescribed manner (Form 12BB) which you too have agreed in your last comment.
          So WHEN to collect them may vary from employer to employer.

        • Yes I agree that the new form is to be implemented.

          I disagree on the following though (not because the information is wrong, but because it is presented in a wrong way)

          >>"So WHEN to collect them may vary from employer to employer."

          When to collect is only when the investment is made. Till then the tax declaration is sufficient, per the new form.

          And try to read the sentence for the name of the companies. They are just not being stupid to follow anything that is never said (forcing people to give evidence in the beginning ).

          They have read it well and have properly implemented the things that are meant to be implemented per the new change. so they ARE following all the rules.

          It is just that they have a good finance team, who actually investigate things and not rely on someone else's view point of the stuff.

          But not all companies are that smart. And then people suffer.

          I do appreciate though that you are actively participating in the discussion, and people will definitely get both view points from this. (If they scroll down this much)

          However, people are going to take you by word because You are in this profession and I an Not. And this is why I am poking my nose in everything you say that can be interpreted into something else.

        • Dear Jagatveer,
          You have quoted few company names which are not adhering to the requirement.
          So I have mentioned that it is up to them to follow the rules or not. But if caught they may have to face the CONSEQUENCES.

• Hi Sir,

  I have a doubt About 80C and rent receipt. I am planing to open o PPF account this year, but have not opened it yet. So How do I provide document for that this quarter?
  My landlord do not provide me with the rent receipts also he refused to create rent agreement . what should I do?

  Thanks
  Pooja

• Hi Sreekanth,

  Thanks for providing information. I have one doubt, I have a RD account can i get tax benefit on it and under which section i can declare it.

  • Dear Sagar..No tax benefits are available.

• Hello Sir,

  My CTC is 6.6 Lakhs per Annum (Have 5 years old Daughter and 11 months old Son).
  Can you suggest me regarding Declarations..

  My expenditures as follow,
  Rented House for 8000/Month.
  LIC policy for 26000/Year.

  Thank in Advance.

  Regards
  Selvaraju

  • Dear Selvaraju,
    Kindly share more details of LIC policy (Plan name, commencement date, tenure etc.,)
    Suggest you to kindly go through below articles and you may revert to me;
    Tax Treatment of various Financial Products.
    List of best Investment options.
    List of Articles on key aspects of Personal Financial Planning.
    List of Income Tax Deductions AY 2017-18.
    Kid's Education Goal Planning.

    • Sir,

      LIC policy details- NEW JEEVAN SREE-I

      Plan-Term-DOC 162-25-10.7.2012

      Premium-Mode-Sum assured 12812-HLY-5 Lakhs.

      • Dear Selvaraju,
        It is a traditional plan. Suggest you to buy a term insurance cover (if you do not have one) and then can discontinue this policy.
        Kindly read:
        Term insurance Vs Traditional plans.
        Best Term insurance plans.
        How to get rid off unwanted life insurance policy?

• i purchased house through home loan, but now it is vacant.
  Where i show this details in form 12bb.

  I am already staying in rental house.

  annual rental income : shall i put zero in this

  • Dear swetha..Yes you can put rental income as zero and show the house as a 'let-out property kept vacant'. You can claim interest payments on home loan under section 24.
    Kindly read below articles;
    Income from house property & home loan tax benefits.
    IT declaration & investment proofs!

• Hi Shreekanth, My doubt is do we need to submit evidences along with form 12BB? For some of my declarations, for ex life insurance premium/PPF, what if I have not paid it yet. How do I provide the proofs.

  Thanks

  • Dear Preeti..Yes, you have to submit documentary evidence of your investments / expenditures. You can submit last payment receipts, that should be fine.

• I take my home loan & pay interest but house is vacant. For my job purpose I stay in Kolkata with rent house. Still now I get both facility home 24 a (home loan interest) & house rent both. So for Form no. 12bb I have to submit House rent Allowance (1) & Deduction of interest on borrowing (3) . Am I right ? Please confirm

  • Dear SOUMEN..Yes you may do so.

• Hi shree a great article again. ..couple of doubts.
  1 . The form 12 bb is applicable from 1 jun 2016.Hence while submitting IT returns this year do I have to submit anything??
  2. I have to claim refund under 80 C wherein I have paid premium of LIC policy but had not declared it earlier.Now do I need to submit the receipt or not??

  • Dear Shrikant,
    1 - There is no need to submit/enclose any documents.
    2 - Not required. You can mention it in your ITR and calculate the tax liability (if any) accordingly.
    Kindly read:
    IT Declaration & Investment Proofs.

• Dear Mr.Reddy,thank you for such hard work on latest INCOME TA FORM 12BB I shall request you to send me this FOR12BB to my email **** WITH BEST WISHES, K.K.SULTANIA

  • Dear Krishna..You may just click on the Form 12BB image to download it and then you can take a print of it (if required).