EPF Withdrawal TDS Exemption Rules: Form 121 replaces 15G/15H From Tax Year 2026-27
New Delhi: Employees wishing to withdraw their Provident Fund (OPF) money before five years of service will be required to follow a new process to claim exemption from tax deducted at source (TDS). According to the Employees’ Provident Fund Organistaion (EPFO), applicants will have to submit Form 121, in line with the Income Tax Act, 2025 as forms 15G and 15H will no longer be accepted for claiming EPF TDS exemptions from tax year 2026-27 onwards.
EPFO released a statement saying that Form 15G/15H is no longer valid for claiming EPF TDS exemptions. Tax year 2026-27 onwards TDS Exemption is to be claimed by submitting Form 121 (as per the Income Tax Act, 2025).
Under Section 192A of the Income Tax Act, 2025, TDS may be deducted when an EPFO member withdraws PF money before completing five years of continuous service.
The TDS deduction is based upon the five-year service requirement. The Income tax-Act 2025 states that the income tax is deducted at source under Section 192A on withdrawals from the EPF if the employee has not completed five years of continuous service.
Form No.121 is a statutory declaration prescribed under the Income Tax Rules, 2026, through which a taxpayer declares that tax liability on its estimated total income for the relevant tax year is nil. Based on this declaration, the payer (deductor) is permitted to not deduct tax at source (TDS) on specified payments.
Declarants shall furnish declaration to deductor on time to ensure that tax is not deducted in the first place -
Ideally submitted before the income is credited or paid
Preferably at the start of the tax year.
How to File Form 121
- Visit Income Tax e-filing portal
- Login to the e-Filing portal using User ID (TAN) and password.
- Go to ‘e-File’ > ‘Income Tax Forms’ > ‘File Income Tax Forms’
- Under ‘Forms as Per Income Tax Act 2025’ category, select ‘Deduction and Collection at source (Form 121)’ and click ‘File Now’.
- On Form page, Select Applicable Filing Type, Tax Year, and Quarter. Click ‘Continue’.
- Click on ‘Let’s get Started’.
Form 121 have 3 sections:
1. Details of the person responsible for paying income
2. Details of declarant and declaration received
3. Declaration
- To complete the form, confirm each section of form.
- Now, click on ‘Details of the person responsible for paying income’.
- Basic information (Name, Address, Email ID etc) of payer will be prefilled from profile section. If any changes are to be made, please Go to ‘My profile’ and change the information.
Additionally, enter PAN no and click ‘Save’.
Details of the person responsible for paying income is completed. Now, click on ‘ Details of declarant and declaration received’.
Under ‘Details of declarant and declaration received’ section, please furnish the details of declarant and declaration received.
