Contents
- Introduction: Form 121 and the End of Form 15G & 15H
- Key Takeaways
- Overview: Form 15G, Form 15H, and Form 121 Compared
- Section 393(6) — The Legal Framework for Form 121
- Who Is Eligible to File Form 121?
- Incomes Covered Under Form 121 — Age-Wise Breakdown
- Incomes NOT Covered by Form 121
- Step-by-Step Procedure to File Form 121
- Due Dates and Compliance Calendar
- Penalties and Consequences of Default
- Tax Planning Tips and Optimisation
- Recent Changes — Finance Act 2025 and CBDT Notifications
- Who Is Impacted?
- Key Cut-off Dates at a Glance
- Frequently Asked Questions
- References and Official Sources
- Disclaimer
- Conclusion
Who should use this guide: Taxpayers, banks, finance teams, and senior citizens checking whether Form 121 has replaced the older Form 15G or Form 15H workflow for their case.
What to verify: Match the latest Income Tax portal instructions, the payer's declaration process, your residential status, and whether your estimated total income keeps the declaration valid.
Before you act: Confirm the correct FY and AY, check whether Form 15H still applies for senior citizens, and keep PAN, income estimates, and interest details ready before submission.
Quick Summary
Form 121 is the new unified declaration introduced under Section 393(6) of the Income Tax Act, 2025, replacing the legacy Form 15G (for individuals below 60 years) and Form 15H (for senior citizens aged 60 years and above). It serves as a TDS nil declaration that an assessee submits to the deductor to certify that their estimated total income for the financial year falls below the applicable basic exemption limit, thereby requesting non-deduction of TDS on specified income.
Introduction: Form 121 and the End of Form 15G & 15H
For decades, millions of Indian taxpayers relied on Form 15G and Form 15H to submit declarations to banks, employers, and other deductors requesting nil or lower TDS deduction on interest income, rent, professional fees, and other specified heads. Starting from 1st June 2025, the Income Tax Act, 2025 — enacted through the Finance Act, 2025 — has consolidated these two separate forms into a single, streamlined declaration: Form 121.
This transition is not merely cosmetic. The introduction of Form 121 under Section 393(6) of the Income Tax Act, 2025 brings with it revised eligibility criteria, a standardised submission process across all deductor types, and stricter compliance timelines. Whether you are a salaried individual receiving interest on fixed deposits, a senior citizen drawing pension income, or a business making rent payments to landlords, understanding Form 121 is now essential for every Indian taxpayer.
In this comprehensive guide, we break down everything you need to know — from the legal basis and eligibility conditions to step-by-step filing procedures, covered incomes, penalties for non-compliance, and practical tax planning strategies for FY 2025-26 (AY 2026-27).
Key Takeaways
Key Takeaways
- Form 121 replaces both Form 15G and Form 15H effective 1st June 2025 under Section 393(6) of the Income Tax Act, 2025.
- The form must be submitted before the date of payment or credit of income to the assessee — it is not valid if submitted retrospectively.
- Any individual (below 60 or senior citizen) whose estimated total income does not exceed the applicable basic exemption limit can file Form 121 to claim nil TDS on specified incomes.
Overview: Form 15G, Form 15H, and Form 121 Compared
To appreciate the significance of Form 121, it helps to understand what the legacy forms covered and how the new regime improves upon them.
| Parameter | Form 15G (Old Regime) | Form 15H (Old Regime) | Form 121 (New Regime) |
|---|---|---|---|
| Governing Law | Section 197A(1) of the Income Tax Act, 1961 | Section 197A(1C) of the Income Tax Act, 1961 | Section 393(6) of the Income Tax Act, 2025 |
| Eligibility – Age | Below 60 years | 60 years and above | All individuals (unified; age considered for exemption limit only) |
| Basic Exemption Limit | ₹2,50,000 | ₹3,00,000 (60–79 yrs); ₹5,00,000 (80+ yrs) | As per applicable regime: ₹3,00,000 (new regime); ₹2,50,000 / ₹3,00,000 / ₹5,00,000 (old regime) |
| Income Types Covered | Interest income only | Interest income only | Interest, dividends, rent, professional fees, contractual payments, and other notified incomes |
| Validity Period | One financial year (April–March) | One financial year (April–March) | One financial year (April–March) or as specified by the assessee |
| Mode of Filing | Physical submission to deductor | Physical submission to deductor | Online via Income Tax Portal or physical submission to deductor |
The most significant change is the expansion of covered income types. While Form 15G and Form 15H were limited exclusively to interest income, Form 121 extends the nil-TDS declaration to a much broader basket of incomes, aligning India's TDS compliance framework closer to global standards.
Section 393(6) — The Legal Framework for Form 121
Section 393(6) of the Income Tax Act, 2025 empowers the Central Government to prescribe a form in which a person may furnish a declaration to the payer (deductor) that tax under Chapter XVII-B need not be deducted from any sum payable to such person. The Form 121 notification was issued under Notification No. 12/2025-CT (dated 28th May 2025) by the Central Board of Direct Taxes (CBDT), prescribing the form, its annexures, and the procedure for furnishing.
Key legal provisions supporting Form 121 include:
- Section 194A — TDS on interest other than securities. Form 121 can be submitted to banks, post offices, and NBFCs to claim nil TDS on fixed deposit interest, recurring deposits, and savings account interest above ₹40,000 (₹50,000 for senior citizens under old 15H; now unified under 121).
- Section 194C — TDS on payments to contractors. Individual contractors with estimated total income below the exemption limit may use Form 121 to avoid TDS on contract payments.
- Section 194G — TDS on lottery commission/brokerage. Individuals earning below the exemption threshold can furnish Form 121 to the lottery operator.
- Section 194I — TDS on rent. Rentpayers (individuals/HUFs) whose total income is below the exemption limit can submit Form 121 to landlords to avoid TDS deduction on rent exceeding ₹2,40,000 per annum.
- Section 194J — TDS on professional/technical fees. Freelancers and professionals can furnish Form 121 to clients claiming nil TDS on fees below the threshold.
| Control | What to confirm | Evidence |
|---|---|---|
| Deadline review | Statutory cut-off, reviewer sign-off, and filing window | Compliance calendar |
| Submission close-out | Acknowledgement, reconciliation note, and exception log | Working paper |
Who should review this change
Readers should confirm who is affected, which taxpayers or teams need to respond, and what records or declarations need fresh review before the next filing cycle.
Timeline and key dates
Check the effective date, due-date implications, transition window, and any follow-up review steps that should be tracked before the next submission or compliance checkpoint.
Quick decision tree and download checklist
| Decision point | If yes | If no |
|---|---|---|
| Are you a resident individual or HUF whose estimated total income keeps the tax on total income at nil? | Move to the current declaration route and payer-specific checklist. | A self-declaration may not be valid; review TDS deduction or a lower-deduction certificate instead. |
| Are you a senior citizen? | Check whether Form 15H remains valid for your institution or whether it has shifted to the Form 121 workflow. | Continue with the non-senior-citizen declaration check. |
| Has your bank or payer moved to the new Form 121 process? | Submit before interest credit, keep the acknowledgement, and review the next renewal date. | Ask the payer which declaration format it accepts for the current FY before you submit anything. |
Downloadable checklist: Download the Form 121 checklist and keep it with your filing notes.
- Confirm the current FY and AY.
- Verify whether Form 121, Form 15G, or Form 15H applies.
- Recalculate estimated total income and nil-tax eligibility.
- Keep PAN, interest details, and payer instructions ready.
- Save the acknowledgement after submission.
Related guides and next checks
Official references
Disclaimer: This guide is for informational purposes only. Review the latest official guidance and consult your advisor before filing or acting on any compliance step.
Bookmark this page, verify the latest official update before you file, and keep this guide handy during your next review.
Frequently Asked Questions
What is Form 121 in Income Tax Act 2025?
Form 121 is a new declaration form introduced from April 1, 2025, replacing Form 15G and Form 15H for claiming non-deduction of TDS on interest income. It unifies the process for both individuals below 60 and senior citizens, requiring PAN-Aadhaar linkage and digital verification.
Why was Form 121 introduced to replace Form 15G and 15H?
To streamline the TDS exemption process and reduce confusion caused by multiple forms. Form 121 modernizes declarations with digital submission, updated eligibility criteria, and a single format for all resident individuals.
Who is eligible to submit Form 121 for TDS exemption on interest?
Any resident individual, including senior citizens and HUFs, whose total estimated income is below the basic exemption limit and who has no tax liability. The form is not available to non-residents or companies.
What is the difference between Form 121 and old Form 15G/15H?
Form 121 combines the features of both old forms into one, applicable to all age groups. It also adds mandatory PAN-Aadhaar linkage, online digital signature or OTP verification, and requires a detailed estimate of total income.
Can I submit Form 121 online for TDS exemption on fixed deposits?
Yes, Form 121 can be submitted online through the income tax e-filing portal or directly to the bank via their digital platforms. Online submission provides instant acknowledgment and reduces paperwork.
What happens if I submit Form 121 but my total income later exceeds the exemption limit?
You must immediately inform the payer and withdraw the declaration to avoid penalties. If you fail to do so, TDS will be deducted retroactively along with interest under Section 201(1A).
Is Form 121 applicable only for interest from banks or also for other income like dividends?
Form 121 is primarily for interest income under Section 194A (bank deposits, post office, etc.). It does not cover dividends; separate TDS rules apply for dividend income under Section 194.
What is the threshold limit for submitting Form 121 to avoid TDS?
The basic exemption limit is ₹2.5 lakh for individuals below 60, ₹3 lakh for those aged 60-80, and ₹5 lakh for very senior citizens (80+). Your total estimated income, including interest, must be below your applicable limit.
Can a Hindu Undivided Family (HUF) submit Form 121?
Yes, HUFs are eligible to submit Form 121 provided their total income is below the exemption limit. The form must be filled using the HUF's PAN, and the declaration is signed by the Karta.
What documents are required to fill Form 121 for TDS exemption?
You need your PAN, Aadhaar, and bank account details. You also need to estimate your total income and tax liability for the financial year; no physical documents are submitted online, but records should be kept.
How many times can I submit Form 121 in a financial year?
You must submit a separate Form 121 to each payer (e.g., each bank branch) from whom you expect interest income. Multiple submissions are allowed as long as each declaration is valid for that specific payer.
Will Form 121 be accepted for interest on recurring deposits and savings accounts?
Yes, Form 121 covers all interest subject to TDS under Section 194A, including savings account interest (above ₹40,000/₹50,000) and recurring deposits. Submit it to the respective branch to avoid TDS.
What is the penalty for submitting a false declaration in Form 121?
A false declaration can result in liability to pay the TDS amount along with interest under Section 201(1A). Additionally, prosecution under Section 276C may lead to imprisonment and fine.
How to download Form 121 from the Income Tax website?
Log in to the e-filing portal at incometax.gov.in, navigate to 'Downloads' > 'Forms', select 'Form 121' for the relevant assessment year, and download the PDF. You can fill it offline or use the online option.
Can NRIs submit Form 121 to avoid TDS on NRO interest?
No, Form 121 is only for resident individuals. NRIs cannot use this form; they must claim TDS refund by filing their income tax return or use other provisions like Form 10F for lower deduction.
What is the last date to submit Form 121 to the bank for TDS exemption?
There is no fixed last date, but it is best to submit Form 121 at the start of the financial year or before the first interest payment. The exemption applies from the date of submission; late submission will not cover earlier interest payouts.
Does Form 121 require renewal every year?
Yes, Form 121 is a yearly declaration valid only for the financial year for which it is submitted. You must file a fresh Form 121 each year if you still meet the eligibility criteria for TDS exemption.
How is Form 121 different from the old Form 15H for senior citizens?
Form 121 replaces Form 15H and adds a unified format for all ages. For senior citizens, the new form requires a more detailed income estimate and can be submitted online with OTP or digital signature, whereas Form 15H was often paper-based.