Returns Form 121 Replaces Form 15g 15h Who Is Eligible Where To Download And How To Avoid TDS Explained

Form 121 replaces Forms 15G and 15H, streamlining the process for individuals seeking exemption from Tax Deducted at Source (TDS) on specific income. This change, brought about by CBDT Notification No. 22/2026, aims to simplify compliance for senior citizens and other eligible individuals. The form is applicable to those whose estimated total income is below the taxable limit, allowing them to receive income without TDS deductions. Form 121 requires detailed information regarding the individual's income and investments, ensuring accurate assessment of eligibility for TDS exemption. Taxpayers must submit Form 121 to the deductor (e.g., banks, financial institutions) at the beginning of each financial year. Failure to comply may result in TDS being deducted at the regular rates, impacting the individual's cash flow and potentially leading to delays in receiving refunds.

Section 197A of the Income Tax Act, 1961 allows individuals to submit declarations for receiving income without TDS if their total income is below the taxable limit. Form 121 serves as the prescribed declaration form. Non-compliance can lead to TDS deductions as per applicable rates under Section 206C and potential penalties for incorrect declarations under Section 277.

The introduction of Form 121 signals the tax department's move towards digital compliance and simplified procedures. While seemingly straightforward, CAs should advise clients on accurately estimating their income to avoid future scrutiny. Aggressive revenue officers may challenge declarations where there is a significant difference between estimated and actual income, potentially leading to reassessment proceedings.

This change simplifies TDS exemption claims, reducing the compliance burden for eligible individuals and ensuring smoother income receipt without unnecessary deductions. CAs and CFOs need to update their clients and internal processes to reflect this new form.