What is Form 12BB Means?

How to fill form 12BB – Investment Declaration and Tax saving

Tax planning is important for every individual at the beginning of a financial year. In this post, we are going to discuss the significance of Form 12BB in the context of Investment Declaration and Tax Savings.

What is Form 12BB?

Form 12BB means a claim declaration statement  that is used by an employee for tax deduction. Employees use this form to declare the investments that they are planning during a financial year to save tax.

Income Tax Slab Rates

The income tax slab rates apply to individuals/taxpayers as per the income thresholds that are defined by the government. Every taxpayer is expected to pay tax as per the income tax slab that applies depending on his/her tax liability.

Regular Tax Regime (Old)

Income Range

Tax Rate

Up to INR 2.5 Lakh

Nil

INR 2.5 to INR 5 Lakh

5%

INR 5 to INR 10 Lakh

20%

Above INR 10 Lakh

30%

Alternate Tax Regime (New)

Income Range

Tax Rate

Up to INR 2.5 Lakh

Nil

INR 2.5 to INR 5 Lakh

5%

INR 5 to INR 7.5 Lakh

10%

INR 7.5 to INR 10 Lakh

15%

INR 10 to INR 12.5 Lakh

INR 12.5 to INR 15 Lakh

Above INR 15 lakh

20%

25%

30%

Further Taxes

– 4% income tax on health and education cess

Surcharge:

15% – If annual income ranges between INR 1 Crore to INR 2 Crore

25% – If annual income ranges between INR 2 Crore to INR 5 Crore

10% – if annual income ranges between INR 50 Lakh to INR 1 Crore

37% – if yearly income above INR 5 Crore

HRA or House Rent allowance

A taxpayer can claim tax deductions on house rent expenses for accommodation. However, the taxpayer is expected to submit the following in the applicable section of Form 12BB:

Rent amount that you pay monthly to the landlord

Name and address of Landlord

PAN card details of Landlord if the rent amount exceeds INR 1 Lakh per year

PAN card details of Landlord if the rent amount exceeds INR 1 Lakh per year

You can submit the rent agreement or rent receipts as proof. In case  of cash rent receipt, it must bear an appropriate revenue stamp.

Deductions under Section 80C, 80CCC, 80CCD

A taxpayer can claim deductions under different income tax sections as mentioned below:

80C : Premiums paid for life insurance and/or other investments such mutual funds, endowment policy, children policy etc.

80CCC : For Premiums paid towards annuity pension plans

80CCD : Any additional contributions made to NPS, APY etc.

Deductions under other sections 80D, 80E, 80G, 80TTA

80D : For premium paid towards medical insurance and senior citizen medical bills

80E : For premium paid towards education loan for higher education of children

80G : For donations made towards specified organizations, charitable funds, etc.

80TTA :For interest income earned from savings bank account, co-operative societies or post office

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