Income-tax Act 2025
Form 121 Replaces Form 15G and 15H: Stopping TDS on FD Interest
From 1 April 2026, Form 121 replaces Forms 15G and 15H. Who can file it, the two conditions for under-60s, worked ₹ examples, and what to do if TDS was cut.
myutils.me9 min read
If your bank asked for a "Form 121" this year instead of the usual Form 15G or 15H, nothing is wrong. From 1 April 2026, Form 121 is the single declaration that replaces both. It is prescribed by rule 211 of the Income-tax Rules, 2026 under section 393(6) of the Income-tax Act, 2025, which takes the place of section 197A of the 1961 Act.
The purpose has not changed. You tell the payer, in advance, that the tax on your estimated income for the year will be nil, and the payer does not deduct TDS from your interest, dividend or other covered income. What has changed is the form number, the "tax year" wording, a single form for every age, and a few new fields.
What changed from Form 15G and 15H
| Point | Before 1 April 2026 (1961 Act) | From 1 April 2026 (2025 Act) |
|---|---|---|
| Form | 15G (below 60, HUFs, trusts), 15H (60 and above) | Form 121 for everyone eligible |
| Section and rule | Section 197A, rule 29C | Section 393(6) and 393(7), rule 211 |
| Year it covers | "Previous year" | "Tax year" (Tax Year 2026-27 is April 2026 to March 2027) |
| Age | Chosen by picking the form | A yes/no field: 60 or more at any time in the tax year |
| Unique number from the payer | Yes | Yes, a 26-character UIN in a fixed format |
A Form 15G or 15H you gave in 2025 covered FY 2025-26 only. Declarations are made for one year at a time, so for interest credited from April 2026 you need a fresh Form 121 with each payer.
Who can file Form 121
The official Form 121 FAQ sets out two groups.
Resident individuals aged 60 or more at any time during the tax year need one condition: the tax on their estimated total income for the year is nil.
Everyone else who may file (individuals below 60, HUFs, trusts and other persons that are not companies or firms) needs two conditions:
- the tax on their estimated total income for the year is nil, and
- the total of the income covered by their Form 121 declarations does not exceed the maximum amount not chargeable to tax (the basic exemption limit).
The form's own notes, in the Rules, add a detail that matters. Estimated total income is worked out after Chapter VIII deductions, any loss under "Income from house property" and the rebate under section 156 (the new number for the old section 87A rebate). So "tax is nil" can be true even when your income is above the basic exemption limit, as long as the rebate brings the tax to zero.
Companies and firms cannot file Form 121.
Worked examples for Tax Year 2026-27
These use the new tax regime, which is the default. The basic exemption limit under it is ₹4,00,000, and the section 156 rebate takes the tax to nil for a resident individual whose total income is up to ₹12,00,000 (income taxed at special rates, such as some capital gains, is outside the rebate).
Example 1: a 34-year-old with salary and FD interest
| Item | Amount |
|---|---|
| Salary | ₹8,50,000 |
| Less standard deduction | − ₹75,000 |
| FD interest from one bank | ₹70,000 |
| Estimated total income | ₹8,45,000 |
| Tax after the section 156 rebate | Nil |
| Income covered by the Form 121 (the FD interest) | ₹70,000 |
| Basic exemption limit | ₹4,00,000 |
Both conditions are met: tax is nil, and the ₹70,000 declared is within ₹4,00,000. The person can give Form 121 to the bank. If the FD interest were ₹4,50,000 instead, the second condition would fail even though the tax might still be nil, and the bank should not accept the form.
Example 2: a 68-year-old living on pension and deposits
| Item | Amount |
|---|---|
| Pension | ₹3,00,000 |
| Less standard deduction | − ₹75,000 |
| FD and senior citizens' scheme interest | ₹6,50,000 |
| Estimated total income | ₹8,75,000 |
| Tax after the section 156 rebate | Nil |
The interest alone is above ₹4,00,000, but that limit does not apply to someone aged 60 or more. Only the nil-tax test applies, and it is met, so Form 121 can go to each bank or post office paying the interest.
If your income is near the ₹12,00,000 line, or includes capital gains or other special-rate income, work out the tax carefully or ask a CA before signing. A declaration is a statement made on your own estimate, and the form warns that a false statement can lead to prosecution under section 482.
Which income Form 121 covers
The FAQ lists the payments a Form 121 can stop TDS on:
- interest from a bank, co-operative bank or post office, and interest from other payers
- interest on securities
- dividends from a domestic company (resident individuals only)
- income from mutual fund units
- rent paid by a "specified person"
- insurance commission
- amounts under a life insurance policy, including bonus
- withdrawal of accumulated provident fund balance, where TDS applies (see PF withdrawal before 5 years)
Salary is not on the list. For salary, the route is to give your employer the right investment and rent details (now in Form 124, which replaced Form 12BB).
How to submit it
- Give a separate Form 121 to every payer. The FAQ is explicit that each bank, company or fund paying you gets its own Part A.
- Fill Part A yourself. It asks for your name, PAN, address, status, residential status, whether you are 60 or more, the tax year, the nature of the income, the estimated income for this declaration, the number and total amount of other Form 121s you have filed this year, your estimated total income, and the acknowledgement numbers and returned income of your returns for the previous two years.
- Use the payer's electronic option where it has one. Rule 211 allows electronic submission verified through an electronic process, or paper. Most banks offer it in net banking or at the branch; the menu name varies by bank.
- Submit early in the tax year, before the first interest credit. The form does not undo TDS already deducted.
- Keep the UIN. The payer fills Part B, allots a unique identification number and reports the declaration in its quarterly TDS statement, even in a quarter in which it deducts no tax.
The UIN has three parts: a running serial number starting with "D" and nine digits, the tax year as six digits (202627 for Tax Year 2026-27) and the payer's TAN. The first declaration a payer with TAN MUMN12345A receives for Tax Year 2026-27 would read D000000001202627MUMN12345A.
A valid, operative PAN is mandatory. If your PAN is inoperative because it is not linked with Aadhaar, the declaration is not valid and TDS can be deducted at the higher rate; see what an inoperative PAN does to TDS and refunds.
Forms 121, 125 and 128: which one you need
- Form 121: your tax for the year is nil and you want no TDS on covered income.
- Form 125: a "specified senior citizen" (the case of very senior pensioners that section 194P covered under the old law) gives this to their specified bank under section 393(1) [Table: Sl. No. 8(iii)]. The bank then works out the tax on their whole income, after deductions and the section 156 rebate, and deducts it.
- Form 128: your tax is not nil but is lower than the TDS would be. You apply for a lower or nil deduction certificate under section 395(1) instead of making a declaration.
If TDS has already been deducted
A Form 121 given in October does not bring back TDS deducted in June. That TDS sits against your PAN in Form 168 (the new number for Form 26AS) and in AIS; see how Form 168 relates to AIS and TIS. You claim it as a refund in your return for Tax Year 2026-27, which you file in 2027. Give the form now to stop deduction on the remaining credits.
Coming in April 2027: one declaration through your depository
The Finance Act, 2026 lets investors file the declaration with their depository for income from securities, units and dividends, provided the securities are held in the depository and listed on a recognised stock exchange. The depository passes it to each payer. The FAQ gives the start date as 1 April 2027, so for Tax Year 2026-27 you still file with each company, fund and bank separately.
Frequently asked questions
Is Form 15G or 15H still valid after 1 April 2026?
No, for income of Tax Year 2026-27. Forms 15G and 15H belonged to the 1961 Act and its rules. Declarations for income credited from 1 April 2026 are made in Form 121 under the 2025 Act.
Can a salaried person below 60 file Form 121?
Yes, if both conditions hold: the tax on estimated total income for the year is nil after deductions and the section 156 rebate, and the income declared in all Form 121s together stays within the basic exemption limit.
Do I need a separate Form 121 for each FD in the same bank?
The rule is one declaration for each payer, and the form asks for the number and total of your other declarations for the year. How a bank records several deposits under one declaration is its own process, so ask the branch whether one form covers all your deposits there.
What if my income rises above the limit after I file Form 121?
The declaration rests on your estimate. If it stops being true, tell the payer so it can resume TDS, and pay any tax due through advance or self-assessment tax. The form's notes warn that a false statement can lead to prosecution.
Will Form 121 stop the interest from showing in AIS?
No. The payer still reports the interest and your declaration in its TDS statement, so the income appears in AIS with nil TDS. You still report it in your return.
Sources
Topics
- Section 87A Rebate
- New Tax Regime
- Standard Deduction
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Written by the team behind myutils.me, a free, independent app that brings ITR status, refunds and AIS/TIS for each PAN into one dashboard. Check anything important against the Income Tax portal before you act on it.
