Individuals who join a new company or a new organisation in the middle of the year are required to submit Form 12b under Rule 26A. The form basically discloses the information regarding the individual’s previous income.
What is Form 12b?
Form 12b is an income tax form that needs to be furnished according to Rule 26A by an individual joining a new organisation or company in the middle of the year. The main purpose of the form is to furnish details of the income earned by the individual from the previous employer. Every new employee has to submit Form 12b to their new employer. Furnishing Form 12b is not compulsory.
What constitutes Form 12b?
The employee has to fill in some details in Form 12b before submitting it to the new employer. It is very important that the individual fill in the correct details in the form.
Listed below are the details that one has to provide in Form 12b before submitting it to the employer.
- Certain details of the previous employer such as PAN number, TAN number, etc
- Break-up of the total salary such as Basic Salary+ DA, House Rent Allowance, Prerequisite, Leave encashment, Leave Travel Allowance and other such parts of the salary
- Deduction in respect to Provident fund
- Deduction in regard to rent free accommodation
- Any deductions under various sections of Income Tax Act including Section 80C, Section 80G, Section 80D, Section 80E, Section 24
- Tax Deducted at Source on Salary deducted by the previous employer
- Professional tax paid by the employee(if any)
What happens after the Employee submits the Form 12b?
Once the employee submits Form 12b with the correct details required, the new employer will furnish a Consolidated Form 16 at the end of the year based on the details provided by the new employee in Form 12b.
FAQ's On Form 12b
- Whose responsibility is it to fill Form 12b?
- Can the current employer refuse to deduct TDS on the individual’s previous salary after the submission of Form 12b?
It is the employee’s responsibility and not the previous employer’s responsibility to fill Form 12b. The employee has to fill in the declaration in Form 12b and also attach Form 16, if provided by the previous employer.
It is the employer’s obligation to deduct TDS on the individual’s consolidated salary after accounting for TDS deducted by the individual’s previous employer.