EPFO Issues Transition Guidelines for Form 121 Replacing Forms 15G and 15H Under Income-tax Act, 2025

The Head Office of the Employees’ Provident Fund Organisation (EPFO) has issued Circular No. WSU/TDS Issues/E-772040/2026-27/1, dated 13/04/2026, formally instructing all Additional Central PF Commissioners (Zones) and Regional P.F. Commissioners to implement revised self-declaration procedures for payments exempt from Tax Deducted at Source (TDS). Issued with the approval of the Central Provident Fund Commissioner (CPFC), the circular encloses a five-page explanatory note from the Income Tax Department, a two-page set of official FAQs, and the statutory three-page proforma of Form 121.

This regulatory overhaul follows the phasing out of the legacy Income-tax Act, 1961, and the commencement of the Income-tax Act, 2025, effective April 1, 2026. The primary operational shift is the complete retirement of the longstanding Form 15G and Form 15H, which have now been unified into a single, consolidated declaration designated as Form 121.

👉 Download the Notification – EPFO Issues Transition Guidelines for Form 121 Replacing Forms 15G and 15H Under Income-tax Act, 2025: [Click Here to Access the File]

The Statutory Foundation of Form 121

Under the earlier tax regime, self-declarations for non-deduction of tax were governed by Section 197A(1), 197A(1A), and 197A(1C), read with Rule 29CC of the Income-tax Rules, 1962. Under the new framework, these declarations are grounded in Section 393(6) of the Income-tax Act, 2025, read with Rule 211 of the Income-tax Rules, 2026.

Instead of segregating declarants across two distinct forms based on age, Form 121 serves as a single statutory instrument for all eligible resident payees. The declaration is structured into two operative components:

  • Part A: Completed, verified, and signed by the declarant seeking receipt of income without tax deduction.
  • Part B: Completed and certified by the payer or deductor responsible for crediting or disbursing the sum.

The proforma introduces modernized digital features designed for system-assisted filing, including auto-population of personal details from registered tax profiles, drop-down selectors, checkbox validations, and standardized address formats, with all financial entries recorded in Indian Rupees.

Eligibility Criteria and Covered Income Streams

Form 121 is not a blanket requirement for all income earners; it is an optional self-declaration available strictly to taxpayers who anticipate that their total tax liability for the relevant tax year will be nil.

The statutory boundaries governing eligibility include:

  • Eligible Persons: Resident individuals (irrespective of whether they are below 60 years or senior citizens aged 60 and above), Hindu Undivided Families (HUFs), and other eligible trusts or entities.
  • Excluded Entities: Non-resident taxpayers, corporate entities, and partnership firms are strictly prohibited from submitting Form 121.
  • Mandatory PAN: Furnishing a valid Permanent Account Number (PAN) is mandatory. If PAN is absent or invalid, the declaration is treated as non-est, and the payer must deduct tax at source at the applicable statutory rate.
  • Income Ceilings for Non-Senior Citizens: For resident individuals below the age of 60 and HUFs, the declaration cannot be accepted if the aggregate income covered under Section 393(6) exceeds the maximum basic exemption limit not chargeable to tax.
  • Assessment for Senior Citizens: Resident individuals aged 60 years or more are exempt from the basic threshold restriction, provided their estimated total taxable income results in nil tax liability after accounting for allowable deductions under Chapter VII of the Act and eligible rebates under Section 156.

Under Section 393(6) and Note 5 of the form, covered payments comprise:

  • Payment of accumulated balance due to an employee participating in a recognized provident fund.
  • Interest on securities, as well as interest other than interest on securities paid by banks, co-operative banks, post offices, or specified persons.
  • Dividend income declared by domestic companies.
  • Income from units of mutual funds or specified undertakings.
  • Insurance commissions for procuring, continuing, or reviving insurance policies.
  • Payments under life insurance policies, including any sum allocated by way of bonus.
  • Rent payments received from specified persons.

Directives for EPF Members and Pending Settlement Claims

For EPF members withdrawing accumulated balances where tax deduction applies, the circular outlines clear operational protocols:

  • Protection of Existing Claims: The circular expressly instructs Regional Offices that PF settlement claims already submitted on or after April 1, 2026, with the older Form 15G or Form 15H must not be rejected or returned. Regional field officers must instead contact the member directly to procure Form 121.
  • Submission Modalities: While the EPFO Information Services Division (ISD) develops portal functionality for online digital e-signing of Form 121, field offices are authorized to accept physically signed and scanned copies uploaded by applicants.
  • Filing Timeline: Declarants must submit Part A to the payer before the scheduled transaction date or before the income is credited or paid. A separate Form 121 declaration must be executed for each distinct tax year.

Compliance Protocols and Payers’ Statutory Obligations

Payers, including EPFO Regional Offices, banking institutions, and commercial organizations, carry specific administrative obligations upon receiving Form 121:

  • Unique Identification Number (UIN): Deductors must assign a UIN to every Form 121 received. The UIN must be generated on a running-number basis with effect from April 1, 2026, incorporating a sequence number, the tax year, and the deductor’s Tax Deduction and Collection Account Number (TAN).
  • Monthly Statements: The deductor must compile a monthly consolidated statement of all Form 121 declarations received and upload it via the Income Tax e-filing portal on or before the 7th day of the following month.
  • Quarterly Reconciliation via Form 140: Even though tax is withheld at a nil rate, payers are legally required to quote each allotted UIN in the quarterly TDS return filed under Form 140. This enables the tax department to reconcile declarations and reflect them within the taxpayer’s Annual Information Statement (AIS) and Form 168.

Statutory Liabilities and Penalties

Self-declarations under the tax statute carry binding legal obligations:

  • Declarant Liability: Note 12 of the form cautions that any individual making a false statement in Form 121 shall be liable for prosecution under Section 482 of the Income-tax Act, 2025.
  • Payer Liability: Failure by deductors to assign running UINs, non-compliance with the monthly portal upload by the 7th of the subsequent month, or omission of reporting in quarterly Form 140 returns attracts statutory financial penalties under the relevant provisions of the Act.

Practical Compliance Measures for Establishments

Establishments, payroll units, and compliance teams must retire all internal legacy templates referencing Forms 15G and 15H. Tax deduction systems should be configured to generate structured UINs starting from April 1, 2026, and administrative schedules must account for the strict monthly deadline on the 7th for uploading consolidated records to the e-filing portal. For EPF claim settlements, tracking incoming forms in coordination with Regional Offices ensures timely disbursement without penal withholdings.

Disclaimer: This publication is prepared solely for informational, academic, and statutory compliance reference and does not constitute formal legal, taxation, or accounting counsel. Regulatory procedures and administrative instructions may be amended through supplemental circulars issued by the Employees’ Provident Fund Organisation or the Central Board of Direct Taxes. Readers and establishments must seek professional legal or tax advice from qualified advocates, chartered accountants, or labour law consultants before acting upon the procedural guidance provided herein. The author and publisher disclaim all liability for actions taken in reliance on this content.