HR Terminology

Form 12B

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Form 12B is a statutory document used in India for income tax declaration. It is typically submitted by employees to their employers when they join a new organisation.

This form provides details of income earned from previous employment(s), allowing the new employer to calculate and deduct appropriate taxes at source. Form 12B includes information such as salary, perquisites, profits in lieu of salary, and any other income sources. Employers rely on this form to ensure accurate tax deductions and compliance with income tax regulations. Employees must diligently fill out Form 12B to facilitate smooth tax administration and avoid potential penalties.

FAQ

Any individual who joins a new employment and has had income from previous employments during the financial year is required to fill out Form 12B. This form helps the new employer to calculate and deduct the correct amount of tax from the employee's salary.

Form 12B typically requires details such as salary from previous employments, tax deducted at source (TDS), income from other sources like rent or interest, deductions claimed under various sections of the Income Tax Act, and any other relevant financial information.

Form 12B should ideally be submitted by the employee to the new employer as soon as they join the organization. This allows the employer to consider the employee's previous income and deductions while calculating the tax liability for the current employment.

Yes, Form 12B is mandatory for employees who have had income from previous employments during the financial year. It helps ensure accurate computation of taxes and prevents under or over-deduction of tax at source.

Failure to submit Form 12B may result in incorrect tax deductions by the new employer, potentially leading to discrepancies in tax payments. This could result in additional tax liabilities or refunds during the income tax filing process, causing inconvenience to the employee. Therefore, it is essential to ensure timely submission of Form 12B to the employer.

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