Forms 15G and 15H Become Form 121: Section 197A vs Section 393(6) Under the Income-tax Act, 2025

From 1 April 2026, a familiar TDS compliance process changes in a practical way. The separate Forms 15G and 15H used under section 197A of the Income-tax Act, 1961 are replaced by a single Form 121 under section 393(6) of the Income-tax Act, 2025. The eligibility conditions broadly continue, but the declaration and tracking mechanism is redesigned around one departmental Unique Identification Number (UIN) for each PAN for a tax year.

Old Law vs New Law: The Core Comparison

Old law — Income-tax Act, 1961: Section 197A governed declarations for non-deduction of tax in eligible cases. Resident individuals below 60 and certain other eligible persons generally used Form 15G, while resident senior citizens aged 60 or more used Form 15H. Under the earlier reporting architecture, payers generated separate UINs for declarations received.

New law — Income-tax Act, 2025: Section 393(6) is the corresponding provision. For tax years beginning on or after 1 April 2026, the declaration is furnished in unified Form 121 under the Income Tax Rules, 2026. The Department states that a single UIN will be allotted for each PAN for a given tax year, and declarations made to different payers will be linked to that UIN.

What Actually Changed?

The most important change is not the right to submit a nil-TDS declaration; that substantive facility continues. The real change is compliance architecture. Two forms are merged into one, and the earlier payer-by-payer UIN process is replaced by a single-UIN model linked to the taxpayer’s PAN and tax year. The stated objective is to reduce duplication, simplify reconciliation and make it easier for payers to identify the relevant declaration through the departmental system.

What Did Not Change?

Eligibility is broadly preserved. The Income Tax Department’s current FAQ states that the eligibility criteria for Form 15G and Form 15H continue under section 393(6). A resident individual below 60, or another eligible person other than a company or firm, must still satisfy the applicable conditions for the declaration. A resident individual aged 60 or more continues to receive the senior-citizen treatment that was associated with Form 15H. A unified form does not mean every depositor can automatically demand non-deduction of TDS.

Why the Single-UIN System Matters

Under the earlier process, a taxpayer holding deposits with several banks could submit multiple declarations, with each payer generating its own UIN. That fragmented the compliance trail. Under the revised framework, the Department says one UIN will be allotted for each PAN for the tax year. Payers will be given a facility to fetch the relevant UIN from the departmental portal. In practice, this should make cross-payer reconciliation easier for banks, finance companies and other deductors while giving the Department a consolidated view of declarations linked to one taxpayer.

Worked Example

Assume a resident senior citizen has fixed deposits with three different banks and is eligible to furnish a declaration for non-deduction of TDS. Under the old framework, Form 15H would be furnished separately to each bank and the compliance trail could involve separate UINs. For Tax Year 2026-27 under the new Act, the taxpayer uses Form 121. The Department’s new system is designed so that the declarations linked to the same PAN and tax year are associated with one UIN, even though the taxpayer may deal with multiple payers.

Transition From 31 March to 1 April 2026

The cut-off is important. The Department’s FAQ states that Form 121 applies for a tax year beginning on or after 1 April 2026. Therefore, declarations for Tax Year 2026-27 and later move to the new statutory and procedural framework. Businesses and financial institutions should not merely rename internal references; their systems, declaration workflows, UIN mapping and employee/customer guidance need to align with section 393(6) and the Income Tax Rules, 2026.

Practical Impact for Banks, Deductors and Taxpayers

For taxpayers, the immediate benefit is simpler form selection: there is no separate 15G-versus-15H form number to choose once the new system applies. For payers, the more significant operational change is centralised UIN retrieval and reconciliation. Banks and other deductors should update customer-facing instructions, TDS workflows, core systems and year-opening controls before accepting declarations for Tax Year 2026-27. Existing eligibility checks should not be relaxed merely because the form has been consolidated.

Compliance Checklist for Tax Year 2026-27

1. Confirm that the declaration relates to a tax year beginning on or after 1 April 2026. 2. Apply section 393(6), not merely the old section 197A reference. 3. Use Form 121 instead of Form 15G or 15H. 4. Verify that the taxpayer satisfies the substantive eligibility conditions. 5. Capture or fetch the departmental UIN linked to the PAN and tax year. 6. Ensure multiple declarations to different payers are reconciled against the single-UIN architecture. 7. Update SOPs, customer communications and internal TDS controls accordingly.

How This Fits Into the Wider TDS Rewrite

The unified Form 121 should be read as part of the wider withholding-tax reorganisation under the 2025 Act rather than as an isolated form change. Our earlier comparison of the TDS provisions under sections 392 and 393 explains how the new Act consolidates and rearranges the old section references: https://www.pgtandassociates.com/post/tds-sections-192-194t-vs-sections-392-393-what-changed-under-the-income-tax-act-2025

Primary Sources

Income Tax Department, Income Tax Forms FAQs under the Income-tax Act, 2025: https://www.incometax.gov.in/iec/foportal/help/all-topics/e-filing-services/income-tax-forms ; Income-tax Act, 2025 and Income Tax Rules, 2026 as available through the Income Tax Department/CBDT. The Department’s FAQs specifically identify section 197A as the old provision, section 393(6) as the corresponding new provision, Form 121 as the new declaration form and the single-UIN mechanism for each PAN and tax year.

Conclusion

The move from Forms 15G and 15H to Form 121 is a good example of the difference between substantive tax continuity and procedural redesign. The eligibility principle survives; the compliance process becomes more unified, digital and PAN-linked. For taxpayers and deductors, the practical priority is therefore not to relearn the nil-TDS concept, but to implement the new form and UIN workflow correctly from 1 April 2026.

PGT & Associates assists businesses and taxpayers with withholding-tax compliance, transition reviews and implementation of new Income-tax Act procedures. Professional advice should be taken for facts specific to a particular taxpayer or payment stream.

Disclaimer: This article is for general informational purposes and is based on the law and official guidance available on the date of publication. It does not constitute legal or tax advice. Readers should verify the latest statutory provisions, rules, forms and notifications before acting.