Form No. 121 (Earlier Form Nos. 15G & 15H): Everything You Need to Know (2026)

Introduction

If you have ever submitted Form 15G or Form 15H to avoid TDS on fixed deposit or bond interest income, there is an important update you should know.

From April 1, 2026, Form No. 121 introduced under the Income Tax Act, 2025 replaces both Form 15G and Form 15H with a unified declaration framework.

The form may be used by eligible individuals to declare that their estimated total income for the financial year is below the taxable limit and accordingly request non-deduction of TDS on specified income, subject to applicable conditions and verification.

This guide explains Form 121, eligibility, process, timelines, and important considerations in a simplified manner.

What is Form No. 121?

Form No. 121 is a self-declaration form that may be submitted to a bank, broker, financial institution, or any other eligible payer to declare that the individual’s estimated total income for the financial year is below the taxable limit. Subject to verification and acceptance by the payer, TDS may not be deducted on specified income covered under applicable provisions.

In simple terms, eligible individuals may submit this form to avoid deduction of TDS on interest or other specified income streams where tax liability is expected to be nil.

Important note: The above provisions are based on the new Income Tax framework and may be subject to notifications, clarifications, and operational implementation.

Submitting Form 121 does not make your income tax-free. It only prevents the payer from deducting TDS at source. You are still required to file your ITR if your income meets the threshold.

Why Was Form 121 Introduced?

• Earlier, taxpayers had to choose between: Form 15G - for resident individuals below 60 years of age

• Form 15H - for senior citizens aged 60 years and above

This often created confusion, especially for first-time taxpayers and senior citizens.

Form 121 has been introduced to simplify the nil-TDS declaration process by:

• introducing a single unified form

• reducing duplication of information

• simplifying language and structure

• enabling streamlined digital submission processes, subject to institutional implementation

Some key simplifications include:

• Single form irrespective of age

• Simplified terminology and fields

• Reduced historical ITR information requirements

• Improved digital compatibility and validations

Who is Eligible to File Form 121?

Form 121 can be filed by the following:

• Resident individuals - both below 60 years and 60 years or above

• Hindu Undivided Families (HUFs)

• Other specified eligible entities that meet the stipulated criteria under applicable provisions

Core eligibility condition: The estimated total income for the financial year, after applicable deductions, should result in nil tax liability. Who is NOT eligible:

• Companies

• Partnership firms

• Non-resident individuals (NRIs)

Additionally, PAN is mandatory. In the absence of a valid PAN, the declaration may be treated as invalid and TDS may be deducted at applicable rates.

What Incomes Are Covered Under Form 121?

Form 121 covers a wide range of income types where TDS is typically deducted at source. These include:

• Interest on bank fixed deposits and savings accounts

• Interest on post office deposits

• Interest on securities or bonds

• Dividend income

• Income from mutual funds

• Payments from life insurance policies

• EPF or PF withdrawals and pension

• Insurance commission

• Rental income

• Other specified incomes where TDS is applicable

Applicability may vary depending on the nature of income and prevailing tax laws.

How to Fill and Submit Form No. 121 (Step-by-Step)

For the Declarant (Individual / HUF)

Step 1: Check your eligibility

Ensure your estimated total income for the financial year results in nil tax liability.

Step 2: Obtain Form 121

The form may be available through:

• Income Tax Department portal

• Banks and financial institutions

• Other eligible intermediaries

Step 3: Fill Required Details

Part A requires the following details from the declarant:

• Full name and PAN

• Status (Individual / HUF / Trust)

• Tax Year and residential status

• Date of birth

• Contact details

• Nature of income and estimated income amount

• Aggregate income for the tax year

• Details of ITR filed in the last two tax years

• Self-declaration confirming NIL tax liability

Step 4: Submit to the payer before income is credited

Submit the form to the bank, broker, company, or institution as per their prescribed process (online or offline).

Where income is received from multiple payers, separate submission may be required depending on institutional processes.

For the Payer (Bank / Institution / Broker)

Once Form 121 is received from the declarant, the payer may:

• Verify the declarant's PAN and eligibility

• Assign a Unique Identification Number (UIN) to each Form 121 declaration received

• Upload a consolidated monthly statement of all Form 121 declarations received to the Income Tax e-filing portal via TAN login - on or before the 7th of the following month

• Quote the UIN in the quarterly TDS statement filed in Form No. 140

Note: Operational processes may vary across institutions.

Note: Timelines and operational requirements may vary depending on institutional processes and regulatory implementation.

Form 121 for Bond Investors: What You Need to Know

Form 121 may be relevant for investors earning coupon (interest) income from:

• Corporate bonds

• Government securities (G-Secs)

• PSU bonds

• Other debt securities

Eligible investors may submit Form 121 to request non-deduction of TDS on such interest income, subject to verification and acceptance by the payer.

In certain cases, operational mechanisms may be enabled through depositories such as NSDL or CDSL for demat-held securities. However, the exact process, applicability, and implementation may vary depending on regulatory and institutional frameworks.

Key points for bond investors to remember:

• Form 121 applies to coupon income from corporate bonds, G-Secs, SDLs, and PSU bonds

• Must be submitted before the first coupon payment date of the tax year

• PAN must be valid and updated in your demat account

• Total income including bond interest and capital gains must result in NIL tax liability

• One submission to NSDL or CDSL covers all demat-held bond holdings from April 1, 2026

• The declaration must be renewed every tax year - it is not a one-time submission

If you are a first-time bond investor, check with your depository participant about the Form 121 submission process before your first coupon is credited.

FAQs on Form 121

Q1. Has Form 121 officially replaced Form 15G and Form 15H?

Yes. Form No. 121 has replaced both Form 15G and Form 15H with effect from April 1, 2026. All taxpayers regardless of age now use a single Form 121 to declare NIL tax liability and avoid TDS deduction.

Q2. Is filing Form 121 mandatory?

No. Form 121 is optional. It is only for taxpayers who do not want TDS deducted because their estimated total income for the tax year is NIL. If you are liable to pay tax, you cannot file this form.

Q3. Is PAN mandatory for Form 121?

Yes. PAN is mandatory. If PAN is not provided, the declaration is treated as invalid and the payer must deduct TDS at the applicable rate under the Income Tax Act, 2025.

Q4. Do I need to submit Form 121 to each payer separately?

Yes, in most cases. If you receive income from multiple sources such as two banks, a company, and a landlord you must submit Form 121 to each payer individually. The only exception is for demat-held bond holdings, where a single submission to NSDL or CDSL is sufficient from April 1, 2026.

Q5. Does Form 121 make my income tax-free?

No. Submitting Form 121 only prevents TDS from being deducted at source. Your income is still taxable if it crosses the exemption limit. You must declare it in your Income Tax Return (ITR) as applicable.

Q6. Are capital gains included when calculating eligibility for Form 121?

Yes. For the purpose of Form 121 eligibility, your total income inclusive of capital gains from equity, property, or bonds must result in NIL tax liability. The basic exemption limit is not calculated excluding capital gains.

Q7. How often do I need to submit Form 121?

Form 121 is valid for one tax year only. You must submit a fresh declaration every year to your payer before the income is credited or paid. It is not a one-time submission.

Q8. What happens if I file Form 121 but my income ends up exceeding the taxable limit?

If your actual income at the end of the year exceeds the taxable limit and tax becomes payable, you are responsible for paying that tax while filing your ITR. Filing a false declaration can attract prosecution under Section 482 of the Income Tax Act, 2025.

Final Thoughts

Form No. 121 is intended to simplify the TDS declaration framework by replacing multiple forms with a unified structure. The revised framework aims to improve ease of compliance and reduce procedural complexity for eligible taxpayers.

However, the exact implementation, operational flow, and institutional processes may vary depending on regulatory updates and system-level adoption.

Disclaimer

This article is intended solely for educational and informational purposes and should not be construed as tax, legal, or investment advice.

The provisions relating to Form No. 121 are based on the Income Tax Act, 2025 and related rules, which may be subject to change, clarification, or phased implementation. Readers are advised to consult qualified tax professionals, financial institutions, or depository participants before acting on the basis of this information.