What Is Form 12BB: Meaning, Required Documents, Format, and How to Fill for Tax Deductions

Form 12BB is an income tax document that employees in India must submit to their employers to claim tax deductions on salary-related investments and expenses. It helps calculate the correct amount of TDS (Tax Deducted at Source). For NRIs earning a salary from India or working for Indian companies abroad, understanding what is Form 12BB is crucial. It ensures that exemptions such as HRA, LTA, and interest on home loans are correctly reflected before TDS is deducted. For NRIs dealing with property transactions, understanding TDS on sale of property by NRI is equally important for accurate tax compliance.

What is Form 12BB?

Form 12BB is a declaration form submitted by salaried employees to their employer to claim deductions and exemptions under the Income Tax Act. It records details of investments, rent, loan interest, and other eligible expenses to ensure accurate TDS calculation. Form 12BB for NRIs is equally important for those earning Indian-sourced income or salary from Indian companies abroad, as it helps them avoid excess tax deductions. It also supports the correct disclosure of Indian-sourced income under applicable income tax for NRI provisions.

Is Form 12BB Applicable to NRIs?

Yes, Form 12BB applies to NRIs who earn salary income from Indian companies or have Indian-sourced earnings. It ensures correct TDS deductions and helps claim eligible exemptions.

• Applicability conditions explained: NRIs must submit Form 12BB if they receive a salary or taxable allowances from India. It allows them to claim eligible deductions such as HRA, LTA, or loan interest to prevent excess TDS on Indian income.
• If the NRI is on the payroll of an Indian company – Yes, required: When an NRI is employed by an Indian organization, Form 12BB submission is mandatory for TDS calculation. NRIs should also be aware of different types of NRI accounts since the account category determines tax applicability and remittance rules.
• If NRI earns a foreign salary with no Indian source – Not applicable: NRIs drawing salary from foreign employers, with no Indian-sourced income, are not required to file Form 12BB, as their tax liabilities fall under the respective foreign jurisdiction.

Key Deductions NRIs Can Claim Through Form 12BB

NRIs can use Form 12BB income tax declaration to claim various deductions on income earned in India. It helps reduce taxable salary by accounting for eligible exemptions and investments. To minimize tax outflow, NRIs can also apply for a lower TDS certificate for NRI when eligible.

• HRA (if renting in India): NRIs paying rent for accommodation in India can declare HRA details through Form 12BB, ensuring accurate deduction and reduced taxable income under the Income Tax Act.
• Home loan interest (Section 24b): NRIs repaying a home loan for a property in India can claim interest deductions by submitting Form 12BB for ITR benefits.
• Investments under Section 80C – ELSS, LIC (if eligible): By including investments like ELSS or LIC premiums in Form 12BB, NRIs can claim deductions up to ₹1.5 lakh, lowering their taxable income.
• Medical Insurance under Section 80D: NRIs can claim deductions on health insurance premiums for self and family by declaring details under Form 12BB, ensuring optimized tax liability in India.
• Education Loan Interest (Section 80E): If an NRI pays education loan interest in India, declaring it in Form 12BB allows deductions on the interest amount without any upper limit.

Documents Required for NRIs

For Form 12BB online filing, NRIs must provide valid supporting documents to verify their deductions and exemptions under the Income Tax Act. These proofs ensure accurate TDS calculation, smooth processing, and compliance for income earned or declared in India.

• PAN card
• Proof of investment (LIC, ELSS, etc.)
• Rent agreement & rent receipts (if applicable)
• Home loan interest certificate
• Proof of NRI status (passport, visa, etc.)

How to Submit Form 12BB for NRI Employees?

Form 12BB simplifies TDS documentation, verification, and submission directly to the Indian employer, ensuring proper TDS deduction.

• Step 1: Use a trusted Form 12BB generator or the official template to fill in details of your investments, rent, and loan interest for an accurate tax declaration.
• Step 2: Enter valid information on HRA, 80C investments, home loan interest, and medical insurance to ensure the correct computation of TDS and avoid future discrepancies.
• Step 3: Include proofs such as rent receipts, investment certificates, and loan interest statements to validate all deductions and ensure tax compliance under Indian regulations.
• Step 4: Once verified, submit the signed Form 12BB to your Indian employer for correct TDS calculation before the payroll processing or at the start of the financial year.

Difference Between Resident and NRI Submission

While both residents and NRIs must submit Form 12BB to claim deductions, the process, eligibility, and documentation vary. NRIs often deal with income sourced from India while residing abroad, requiring additional proof like NRI status and property details. Understanding these differences ensures proper compliance and accurate TDS deduction on salary and investment income.

NRIs can further benefit from DTAA income tax provisions, which help avoid double taxation on salary and investment income earned in India.

Form 12BB – Statement of Claims by an Employee for Deduction of Tax

(See rule 26C of the Income Tax Rules, 1962)

1. Employee Details

• Name of the Employee: __________________________________
• PAN of the Employee: __________________________________
• Address: ______________________________________________
• Financial Year: _________________________________________

2. Details of Deductions Claimed

(a) House Rent Allowance (HRA)

• Name and address of landlord: __________________________
• PAN of landlord (mandatory if annual rent exceeds ₹1,00,000): __________________________
• Rent paid to landlord (per annum): ₹____________________
• Period of rent payment: From ______________ To ______________

(b) Leave Travel Concession or Assistance (LTA/LTC)

• Details of expenditure on travel: ₹____________________
• Proof of travel attached: Yes / No

(c) Deduction of Interest on Borrowed Capital (Home Loan Interest)

• Interest payable/paid to the lender (per annum): ₹____________________
• Name, address, and PAN of the lender: __________________________
• Property address: __________________________
• Purpose of loan: Purchase / Construction / Repairs

(d) Deductions under Chapter VI-A

3. Verification

I, ______________________ (name of the employee), hereby declare that the information given above is true and correct to the best of my knowledge and belief.

Place: ____________________
Date: ____________________

Signature of Employee: ____________________

How NoBroker Can Help With NRI Services?

NoBroker offers a complete range of NRI services, including guidance on what is Form 12BB and related compliance. For NRIs earning Indian income, NoBroker helps with rent agreement creation, tenant verification, and rent receipt generation, which are essential for claiming HRA and tax deductions. The platform also assists in managing property taxes, home loans, and investment proofs online, ensuring smooth compliance with Indian tax laws. NRIs can rely on NoBroker for secure, transparent, and hassle-free support. Visit NoBroker today to simplify your NRI property and tax management.