The new Income-Tax Act (ITA) 2025, which came into force from last month (1 April), replaced the original Tax Deducted at Source aka TDS forms — Form 15G and 15H — with a single Form 121. Overall, the updates are meant to streamline and simplify India’s tax codes, the government said, noting that it has consolidated number of forms from 399 to 190. Notably, the new forms will be used for AY27 (FY26).
Forms 15G, 15H replaced: What is Form 121?
From AY2026-27, Form 121 is the new, unified income tax form that replaces the erstwhile Form 15G and Form 15H, which both dealt with TDS. The form is to be submitted by individuals and Hindu Undivided Families (HUFs) to prevent deduction of TDS on dividends, interest and other income when earnings are below the taxable amount.
Notably, while the previous two forms were separated based on age (separate form for senior citizens), the unified Form 121 is enough for all taxpayers across ages.
How to use Form 121 to avoid TDS?
To avoid TDS, the declaration must be submitted before deduction takes place either in person or online through their respective bank’s website or app. This is an annual exercise and must be repeated each tax year.
Notably, Form 121 should be submitted by the taxpayer before the interest is credited as TDS will also be deducted at the time of crediting interest.
For example, bank depositors need to submit Form 121 to the bank to avoid TDS on the interest earned on fixed deposits before the monthly interest payout. For Tax Year 2026-27, it is advisable to submit Form 121 in April itself to avoid TDS.
In case of deposits and accounts with multiple banks, you will have to submit a Form 121 to each of the banks separately to avoid TDS. Similarly, Form 121 will also have to be submitted with India Post, if you have post office FDs or pension payouts.
What is eligibility and non-eligibility for Form 121 use?
- To be eligible, the taxpayer — Must be an Indian resident with total tax liability after exemptions and deductions at zero.
- The basic exemption limit under the old tax regime is ₹2.5 lakh for individuals below 60 years, and ₹3 lakh for senior citizens. Under the new tax regime, the limit is ₹4 lakh for all individuals.
- Companies, individuals or entities with taxable income, non-resident Indians (NRIs) and partnership firms are not eligible to use the form.
What earnings does Form 121 cover?
Dividend income, Employee provident fund (EPF) or public provident fund (PPF) withdrawals and pension, insurance commission, interest on bank fixed deposits (FDs) and savings accounts, income from mutual funds, interest on post office deposits, interest on securities or bonds, payments from life insurance policies, rental income and other specified incomes where TDS is applicable, according to a Clear Tax report.
Where can taxpayers download Form 121?
- You can download the Form 121 PDF from the I-T Department’s website here — https://www.incometaxindia.gov.in/
- Click on ‘Income Tax Provisions’ and navigate to ‘Income Tax Forms (2026)’
- Enter the Form number 121 and click on search
- Form 121 can be opened on a separate tab
- Save and download the PDF on your device.
What happens if taxpayers do not submit Form 121?
In case TDS has been cut over the taxable amount because of non-submission of Form 121, taxpayers are eligible for a refund after your ITR has been processed. The refund will be directly credited to your savings bank account as mentioned in ITR.
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