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Declaration by employee for opting new tax regime for FY 2020 2021

Shahnaz (Manager Payroll & Accounts) (24 Points)

04 April 2020

Hi,

There is 12BB Form for opting old tax regime but we need a form/declaration in a specific form from employee who wanted to opt for new tax regime.

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5 Replies

Mandakulathur Ananthanarayanan (186 Points)
Replied 07 April 2020

Yes. the option is to be opted only before filing return of income. Hence, we can expect rules and forms for the same to be rolled out by CBDT.

Shahnaz (Manager Payroll & Accounts) (24 Points)
Replied 07 April 2020

Thanks Mr Ananthanarayanan.

If an employee say that he wanted his tax to be deducted as per new tax regime (less rates) from April 2020 salary then what declaration should we take from him.

Mandakulathur Ananthanarayanan (186 Points)
Replied 07 April 2020

May be we can take a formal declaration in writing till we receive any circular in this regard and that will protect us from future proceedings

Sujit Talukder (service) (719 Points)
Replied 07 April 2020

An employer has no option but has to mandatorily deduct TDS as per section 192 which prescribes only the old method of taxation even though an employee decides to go for the new tax regime.

Strange but true, this is how the law is prescribed.

Read this

https://www.taxcorner.co.in/2020/02/section-115bac-option-of-new-tax-to-employee-and-tds-by-employer.H T M L

Sujit Talukder (service) (719 Points)
Replied 13 April 2020

CBDT issued a detailed Circular clarifying the process of exercising of option by a taxpayer with regard to deduction of tax at source if he/she opts for the concessional rates of tax as per section 115BAC of IT Act,1961

https://www.taxcorner.co.in/2020/04/cbdt-issues-circular-to-clarify-option-under-section-115bac-and-tds-by-employer.H T M L