CBDT: CBDT has issued this new form from October 15. Under this, you will be able to give information about your various investments. Along with this, you will also be able to reduce the deduction in your salary.
New Form to Reduce TDS from Salary: Lakhs of salaried employees of the country can now reduce the deduction of TDS (Tax Deducted At Source – TDS) from their salary. The Central Board of Direct Taxes (CBDT) itself has taken this measure. CBDT has issued a new form 12BAA for this. If employees want to reduce the amount of TDS deducted from their salary, then they will have to fill this form and give it to their employer, in which information about TDS deducted from sources other than their salary and Tax Collection at Source (TCS) will have to be given. Its main objective is to reduce the TDS deduction from salary, so that employees can save more and their cash flow problem can be reduced.
How will you benefit from Form 12BAA?
- Through this form, employees can inform their employer that apart from their salary, tax has been deducted in the form of TDS from other sources of income, such as fixed deposits (FD), insurance commission, or share dividend.
- If the employee has made a big purchase like a car, or has made payment in foreign currency and TCS has been deducted on it, then it can also be recorded in this form.
- By filling this information in Form 12BAA and sharing it with the employer, the TDS deduction from the salary can be reduced. This will increase the income of the employees and they will get more money to spend or save.
What information has to be given in Form 12BAA?
In Form 12BAA, employees have to give these important information related to TDS and TCS deduction from any of their other income or expenses:
Information to be provided for TDS:
- Section under which TDS was deducted
- Name and address of the person deducting TDS
- TAN number of the person deducting TDS
- Amount of tax deducted under TDS
- Total amount of income on which TDS has been deducted
- Any other necessary information
Information to be provided for TCS:
- Section under which TCS was collected
- Name and address of the person collecting TCS
- TAN number of the person collecting TCS
- Total amount of TCS deducted
- Any other necessary information
Apart from these things, space has also been provided in this form to give information about the loss caused to the house property. That is, if the employee has suffered any loss from the house property, then it can also be recorded in this form. After giving all the information, the employee will have to verify it and sign it and then submit it to his employer.
Who can take advantage of the new form?
This new form 12BAA issued by CBDT can be availed by such employees, whose TDS or TCS has been deducted from other sources of income or from big expenses. For example, TDS on income from fixed deposits, shares or TCS deduction on any big purchase. If such employees want less TDS deducted from their salary and their take-home salary is more, then they can take advantage of this new form. If an employee has suffered a loss from house property, then he can also tell this to his employer so that his tax liability can be reduced.
How will TDS be deducted from salary as per the new rules?
As per the new rules, employees can inform their employer about TDS and TCS deductions from other sources through Form 12BAA. With this, the employer can make adjustments in the TDS deducted from the salary. This rule has come into effect from 1 October 2024.
Form 12BAA: How is it different from Form 12BB?
Both Form 12BAA and Form 12BB are tax declaration forms, but in Form 12BAA, employees can also give information about TDS and TCS deducted from sources other than their salary. This will result in less tax being deducted from the salary and employees will get more take-home salary. Employers will now be able to deduct TDS from the salary of employees on the basis of this new form. For this, they will have to collect the necessary information given in Form 12BAA from the employees and make tax adjustments on that basis. The issuance of Form 12BAA is a relief measure for those salaried employees who currently have to wait for a long time to get the refund of TDS and TCS amount deducted from sources other than salary.
What was announced in the budget?
In the budget, the government had announced that TDS and TCS deducted from other sources will be adjusted in the TDS deduction from the salary of employees. Its main objective was to reduce cash flow problems for employees. By adjusting TCS and TDS in this way, employees will not need to claim tax refund. This process will simplify tax compliance and will also speed up the processing of ITR.
