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EPFO New Rules: Fill Form 121 to Avoid TDS on PF Withdrawal Starting 2026
- •Form 121 has replaced Form 15G and 15H under new income tax laws effective from April 1, 2026.
- •Members with zero estimated tax liability can submit Form 121 to avoid TDS on PF withdrawals.
- •Having a valid and correct PAN card linked to EPFO is mandatory to ensure the declaration is valid.
- •TDS of 10 percent generally applies to withdrawals exceeding Rs 50,000 if service is less than five years.
Key Questions Answered
Starting from the 2026-27 tax year, Form 121 has replaced both Form 15G and Form 15H for claiming TDS exemption on EPF withdrawals. This unified form was introduced following the implementation of the Income-tax Act, 2025, to simplify the process by removing the need to select separate forms based on age.
Form 121 can be submitted by resident individuals whose estimated total income for the relevant financial year results in a zero tax liability. It serves as a declaration that your yearly earnings fall below the taxable threshold, enabling eligible members to prevent TDS on withdrawals.
No, simply submitting Form 121 does not automatically make your PF withdrawal tax-free. The form only allows eligible individuals to avoid TDS deduction if their annual tax liability is nil, and your final tax obligations will depend on standard income rules and your specific service history length.
