EPFO Shifts to Form 121 for TDS Exemption Declarations from April 1, 2026

The Employees' Provident Fund Organisation has issued directions to implement a new consolidated declaration format for tax deduction at source exemptions. This change follows the rollout of the Income-tax Act, 2025, which replaces the Income-tax Act, 1961, from April 1, 2026.

Forms 15G and 15H will be discontinued for this purpose and replaced by Form 121. The instructions apply to EPFO field offices acting as payers of income.

Background of the Regulatory Change

The transition to Form 121 is linked to the implementation of the new income-tax framework effective April 1, 2026. Under the revised law, earlier declaration forms used for seeking non-deduction of TDS will no longer be valid.

EPFO has been instructed to align its processes with the updated legislative requirements. The change is intended to standardise declarations and reduce duplication under the new tax structure.

Eligibility Criteria and Filing Process

Form 121 can be submitted by a resident individual whose estimated tax liability for the relevant financial year is nil. The declaration is applicable only for individuals seeking exemption from TDS on eligible income and is not mandatory for all members.

The declarant is required to complete and sign Part A of the form. Part B must be filled in by the payer, such as the concerned EPFO regional office.

Responsibilities Assigned to EPFO Field Offices

EPFO has made it mandatory for its regional offices to assign a Unique Identification Number to every Form 121 received. The UIN must contain a running sequence number, the applicable tax year, and the Tax Deduction and Collection Account Number of the payer.

Offices are required to maintain continuity in the UIN sequence starting April 1, 2026. These measures are intended to ensure traceability and audit compliance.

Reporting, Upload, and System Integration

Field offices must compile a consolidated monthly statement of all Form 121 declarations received. This statement needs to be uploaded to the income-tax e-filing portal by the 7th of the following month.

The UINs generated must also be quoted in the quarterly TDS return filed in Form 140. EPFO has instructed its internal systems division to enable digital e-signing and online submission of Form 121 for members.

Read More: EPFO Simplifies Procedure for Fund Transfer to International Workers.

Conclusion

The introduction of Form 121 marks a procedural change in how TDS exemption declarations are handled by EPFO. It aligns provident fund operations with the new Income-tax Act effective April 1, 2026.

Until the online facility is fully operational, physically signed forms uploaded by members will continue to be accepted in place of Forms 15G and 15H. The move is aimed at improving compliance, standardisation, and reporting efficiency within the updated tax framework.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions.

Investments in the securities market are subject to market risks, read all the related documents carefully before investing.