If you have ever submitted Form 15G or Form 15H to your bank to stop TDS (Tax Deducted at Source) on income such as savings account or fixed deposit interest, there is an important change. Under the new Income-tax Act, 2025, the government has introduced Form 121, which replaces both Form 15G and Form 15H.
New Form 121 is for people whose total income is below the taxable limit, so they should not have to pay TDS (Tax Deducted at Source). Let’s understand it in a simple way so you know who can use Form 121, when to submit Form 121, and how to use it correctly.
What is Form No. 121 and why is it used?
Form 121 is a self-declaration that you submit to your bank or any other payer. In this form, you declare that your total income for the financial year is below the taxable limit, so TDS (Tax Deducted at Source) should not be deducted from your income.
In simple words, you are telling the bank, “Please don’t deduct tax (TDS) from my income because I don’t have to pay any tax this year.” This form is useful when TDS would normally be deducted automatically, even though your total tax liability for the year is zero.
Here are some common incomes where this applies:
- Interest on bank deposits
- Post office deposits
- Dividends
- Insurance commission
- Rent or other specified incomes
The important thing to understand is that Form 121 does not make your income tax-free. It only prevents unnecessary tax deduction at source.
Has Form 121 replaced Form 15G and Form 15H?
Yes. This is one of the biggest changes introduced under the new Income-tax Act, 2025.
Earlier, there were two separate forms:
- Form 15G – For individuals below 60 years of age and Hindu Undivided Families (HUFs).
- Form 15H – For senior citizens aged 60 years or above.
Now, both these forms have been replaced by a single Form 121.
This makes the process much simpler. You no longer need to choose a form based on your age. If you are eligible, you only need to submit Form 121.
Who can use Form No. 121?
Not everyone can use this form. It is meant only for specific taxpayers who meet certain conditions. You can use Form 121 if:
- You are a resident individual (any age)
- Or a HUF (Hindu Undivided Family)
- Your total income is below taxable limit
- Your final tax liability is NIL
- You have a valid PAN
But some people are not allowed to use it:
- Companies and firms
- Non-residents
The key idea is simple: If your income is below the taxable limit, you can submit Form 121 to stop Tax Deducted at Source (TDS) from being deducted.
When should you submit Form No. 121?
Timing is very important here. You should submit the form:
- Before income is credited or paid
- Ideally at the beginning of the financial year
If you delay submission, the bank may already deduct TDS, and then you will have to claim a refund later. So practically, always submit it early to avoid unnecessary hassle.
What details are required in Form No. 121?
The form is divided into two parts, but from your side, you mainly fill Part A.
You will need to provide:
- Personal details (Name, PAN, DOB, address)
- Residential status
- Estimated income for the year
- Details of income where TDS should not be deducted
- Previous ITR filing details
You may also need:
- PAN (mandatory)
- Bank details
- Proof of age (in some cases)
If PAN is not given, the form becomes invalid and TDS will be deducted.
How do you submit Form No. 121?
The process is quite straightforward and similar to what you might have done earlier with 15G/15H. Here’s how it works:
- Download the form or use online banking
- Fill in your details carefully
- Submit it to your bank or payer
- Submit separately to each payer if you have multiple sources
Many banks now allow online submission, which makes it easier and faster.
What happens after you submit the form?
Once you submit the form, the responsibility shifts to the payer (like your bank). They will:
- Verify your details
- Assign a Unique Identification Number (UIN)
- Report it to the Income Tax Department
- Not deduct TDS if everything is valid
This UIN is important because it helps track your declaration in official records.
Is filing Form No. 121 mandatory?
No, it is not compulsory. You only file it if:
- You want to avoid TDS, and
- You meet the eligibility conditions
If you don’t submit it, TDS will be deducted, and you can later claim a refund while filing your ITR.
What are the key benefits of Form No. 121?
This form is very useful for small taxpayers and retirees. Here’s why it matters:
- Prevents unnecessary TDS deduction
- Avoids refund delays
- Improves cash flow (you get full income upfront)
- Simplifies tax compliance
In practical terms, it saves you from giving an interest-free loan to the government.
What are the major changes in the new Form 121?
The new form is designed to be more user-friendly and digital. Some key improvements include:
- Merger of Form 15G & 15H
- Simplified structure
- Pre-filled details and validations
- Better online integration
This reduces errors and makes filing easier, especially for beginners.
Conclusion
Form No. 121 is a simple but powerful tool if your income is below the taxable limit. It helps you avoid unnecessary TDS and keeps your cash flow smooth throughout the year. The main thing to remember is that this form is not about saving tax—it is about avoiding unnecessary deduction when no tax is actually payable. If used correctly and submitted on time, it can make your tax experience much more comfortable and hassle-free.
Old vs New Mapping: Form 15G / 15H → Form 121
| Particulars | Old System (Income-tax Act, 1961) | New System (Income-tax Act, 2025) |
|---|---|---|
| Form Name | Form 15G & Form 15H | Form No. 121 |
| Applicability | 15G → Below 60 years 15H → 60 years & above | Single form for all eligible individuals |
| Purpose | Declaration to avoid TDS when tax liability is NIL | Same purpose (no change) |
| Governing Section | Section 197A | Section 393(6) |
| Relevant Rule | Rule 29C (Income-tax Rules, 1962) | Rule 211 (Income-tax Rules, 2026) |
| Eligibility | Resident individuals & HUFs | Same (no change) |
| Non-Eligibility | Non-residents, companies, firms | Same (no change) |
| PAN Requirement | Mandatory | Mandatory |
| Submission | To each payer separately | Same (no change) |
| Filing Mode | Physical / Limited online | More digital & system-driven |
