Form 121: The Complete Guide to TDS Exemption Declarations from April 2026 (Replaces 15G and 15H)

If you are a senior citizen who has filed Form 15H every April for the last decade, or an SME owner whose grown-up children receive bond interest, the form has changed. From April 1, 2026, a single Form 121 replaces both 15G and 15H. The rules for who qualifies are largely the same, but the form, the tracking number, and the submission flow are new.

This guide covers two audiences in sequence. First, the individual submitter who wants to stop unnecessary TDS. Then the deductor (bank, NBFC, company, mutual fund) who has to accept Form 121 and issue UINs.

What Changed from April 1, 2026

Under the old 1961 Act, there were two declarations:

• Form 15G for resident individuals under 60 and HUFs with nil tax liability.
• Form 15H for resident senior citizens (60 and above) with nil tax liability.

The two forms were functionally identical apart from age. Banks, companies, and mutual funds had to maintain separate workflows and generate a fresh UIN each time, even for the same PAN and tax year. This created duplication, reconciliation errors, and refund blockages.

From April 1, 2026, under Section 393(6) of the Income Tax Act 2025:

• Both forms are abolished. Form 121 is the single replacement.
• Age is no longer a distinction. A 25-year-old and an 80-year-old use the same form.
• The UIN system is rationalised (see the deductor section below).
• The eligibility conditions carry forward mostly unchanged.

Who Can Submit Form 121

Form 121 is available to:

• Resident individuals of any age, whose total estimated tax liability for the financial year is nil.
• Hindu Undivided Families (HUFs) meeting the same nil-liability test.
• Other specified resident entities notified by CBDT under Section 393(6).

Form 121 is not available to:

• Non-Resident Indians (NRIs).
• Companies.
• Partnership firms and LLPs.
• Any entity whose estimated tax for the year is not nil.

The Nil Tax Test

Your estimated total tax on total income for the tax year must be nil, after giving effect to:

• The slab rates under your chosen regime (new regime is the default).
• Chapter VIA deductions (if you opted for the old regime).
• The Section 87A rebate, which zeroes out tax for resident individuals with taxable income up to ₹12,00,000 under the new regime for FY 2026-27.

For senior citizens (60 and above), the threshold is relaxed. The basic exemption limit calculation allows higher estimated income before the declaration becomes inaccurate. This relaxation carries forward from the old 15H logic.

If you expect any tax liability (for example because of short-term capital gains, rental income above the basic exemption, or business profits), Form 121 is not the right instrument. Banks will deduct TDS and you will claim a refund or adjustment at filing.

Income Types Covered

Form 121 can prevent TDS on the following resident income types:

HUF restriction: An HUF or Association of Persons (AOP) can use Form 121 for categories (a) to (f) above, but dividends (category g) are not available for HUF declarants. This is a carry-forward rule from the old 15G framework.

How to Submit Form 121 as an Individual

Form 121 is submitted once per payer, not once per PAN per year. If you have FDs with three banks, dividends from two companies, and rent from one tenant, you file six Form 121 declarations.

The practical sequence:

1. Estimate your total income for FY 2026-27 from all sources.
2. Verify nil tax liability after slab and rebate. If you owe any tax, Form 121 is not appropriate.
3. Collect PAN details (the form is invalid without PAN; no-PAN means TDS at 20%, not exemption).
4. Download Form 121 from the incometaxindia.gov.in forms repository or your deductor's portal.
5. Fill in identity details, PAN, the estimated income breakdown, and the specific income type the declaration covers.
6. Submit to each deductor physically or through their online declaration portal. Most banks now accept e-submission through net banking.
7. Receive the UIN from the deductor. Keep this reference. It appears in your Form 26AS and AIS.

A Form 121 submitted in April covers TDS for the full financial year. If you switch banks, buy new FDs mid-year, or take up a new mutual fund, you must file a fresh Form 121 with the new deductor before they credit or pay the income.

How Deductors Process Form 121 and Issue UINs

If you are a bank, NBFC, company, mutual fund, insurance company, or any other deductor, Form 121 is processed at three points.

At receipt. Validate the declarant's PAN against the ITD PAN verification utility. Validate that the declarant is a resident individual or HUF. Record the declaration details in your deductor system.

At UIN issuance. Generate a 26-character UIN in the format: sequence number + tax year + TAN of the deductor. The sequence is deductor-specific. The tax year is the FY in which the declaration is accepted. The TAN ties the UIN to your organisation for reconciliation.

At quarterly TDS return. In your Form 140 (or Form 144 for non-resident, though Form 121 declarants are always resident), report each Form 121 declaration received during the quarter along with its UIN. The department's system reconciles the UIN-wise declarations against the PAN-wise exemption claimed in the deductee's AIS.

The rationalisation that matters: under the old Act, a single PAN submitting Form 15G to three different payers generated three unrelated UINs. Under the new framework, the department links all UINs issued to the same PAN for the same tax year into a single consolidated PAN-year profile. This reduces duplicate validation and helps detect cases where the same declarant has claimed nil liability with multiple deductors whose combined credits would exceed the basic exemption.

Late Filing and Consequences of Wrong Declaration

Form 121 must be submitted before the first credit or payment event of the financial year at that deductor. If you submit after interest has already been credited to your account, TDS on that credit is not reversed. It will reflect in your 26AS and can only be recovered as a refund at ITR filing.

Filing a Form 121 when your actual liability is not nil is a false declaration. Under the 2025 Act this attracts:

• Immediate denial of exemption once the discrepancy is detected.
• Penalty equivalent to the tax evaded plus 1% monthly interest.
• In willful cases, prosecution under the black-letter provisions of the 2025 Act carried forward from old Sections 277 and 277A of the 1961 Act.

Do not file Form 121 to "buy time" on TDS if you expect actual tax liability. The compliance cost of a false declaration is far higher than the working-capital benefit of deferred TDS.

Common Mistakes to Avoid

• Submitting old Form 15G or 15H in April 2026. They are invalid. The bank will accept the paper and then ignore it, or reject it outright. Either way, TDS deduction continues.
• Forgetting the PAN. A Form 121 without PAN is treated as a no-PAN declaration and the deductor applies TDS at the higher rate of 20% under the aggregation rule.
• Assuming one declaration covers all payers. Form 121 is strictly per-payer. File fresh with each new bank, company, or mutual fund.
• Filing when you have capital gains. Short-term capital gains above the basic exemption break the nil-liability test. Form 121 is inappropriate.
• Not tracking the UIN. Keep the 26-character UIN for each declaration. It is how you reconcile against 26AS and AIS if a discrepancy shows up later.
• Filing mid-year for past credits. Form 121 is prospective. It cannot reverse TDS already deducted on earlier credit events.

Let TaxGarden Manage Your Declarations

Individual taxpayers with multiple FDs, bond holdings, and mutual fund positions often miss Form 121 filings with two or three deductors every year, leading to working-capital stuck with the department until refund.

Explore TaxGarden's Compliance Standard plan. We file Form 121 with each of your deductors before the first credit of the year, log every UIN, and reconcile against your 26AS and AIS quarterly. No missed declarations, no avoidable TDS, no refund queue.

Frequently Asked Questions

I filed Form 15H in April 2025 for FY 2025-26. Do I need to file Form 121 now?

Yes. Form 15H submitted for FY 2025-26 does not carry forward to FY 2026-27. File Form 121 fresh with each of your deductors in April 2026 to avoid TDS on FY 2026-27 income.

Can I submit Form 121 online?

Yes, through your bank's net banking portal, the mutual fund AMC's investor portal, or the company's registrar portal. A few banks still accept physical forms at the branch. The deductor's channel, not the income tax portal, is the submission route.

I am 65 with only FD interest of ₹4 lakh. Am I eligible for Form 121?

Almost certainly yes. Under the new regime for FY 2026-27, taxable income up to ₹12 lakh is fully rebated under Section 87A. Your liability is nil. Form 121 is the correct declaration.

My wife is an HUF karta. Can the HUF file Form 121 for dividends?

No. Under the carried-forward old 15G rule, HUFs cannot use Form 121 for dividend income. The HUF can file for FD interest, post office deposits, bonds, MF IDCW, rent, and insurance commission, but not for dividends.

What is the UIN and do I need to submit it with my ITR?

The UIN is the 26-character identifier your bank or company issues on accepting Form 121. You do not submit it in your ITR, but it appears in your Form 26AS and AIS. Keep the UIN receipt for reconciliation in case the deductor's TDS reporting is incorrect.

What happens if I submit Form 121 but my income exceeds the estimate?

File a revised declaration or withdraw the declaration with the deductor. If you do not, and actual income produces tax liability, you pay the tax with self-assessment, plus interest under Sections 424 and 425 (old 234B and 234C). For small, accidental excess, this is a filing error, not a false declaration. For willful under-estimation, penalty applies.

This guide is current as of April 15, 2026 and reflects the Income Tax Act 2025 effective April 1, 2026. Eligibility conditions, PAN requirement, UIN mechanics, HUF restriction on dividend declarations, and income types covered have been verified against the incometaxindia.gov.in Form 121 FAQs (guidance document released April 2026), ClearTax's Form 121 resource page, IndiaBonds' and TaxGuru's Section 393(6) analyses, and news coverage from BusinessToday, India TV, and ZeeBiz. Confirm specific declaration requirements with your deductor before submission.