Planning EPF withdrawal? Old forms won’t work for TDS relief from FY 2026-27

In an important update for Employees Provident Fund (EPF) subscribers, the government has revised the process for claiming TDS exemption on withdrawals, bringing in a significant change that will come into effect from the tax year 2026–27.

Until now, individuals could submit Form 15G or Form 15H to avoid tax deduction at source (TDS) on EPF withdrawals, provided they met the specified conditions. However, these forms will no longer be valid for this purpose going forward.

From FY 2026-27 onwards, taxpayers will be required to submit a newly introduced Form 121 to claim TDS exemption on EPF withdrawals. This change has been introduced under the provisions of the Income Tax Act, 2025, signalling a shift towards a more streamlined and updated compliance framework.

"Important Update. Form 15G/15H is no longer valid for claiming EPF TDS exemptions.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)," the Employees Provident Fund Organisation (EPFO) posted on social media platform X.

EPF members, especially those planning withdrawals in the coming financial years, should take note of this change and ensure they are using the correct form. Failing to submit the updated Form 121 could result in TDS being deducted, even if the individual is otherwise eligible for exemption.

What is the present EPF withdrawal system?

Despite increasing digitisation, members still need to initiate a formal application to withdraw funds, which makes the process structured but still procedural in nature.

EPF interest rate update

“After due deliberations, the CBT recommended an 8.25% annual rate of interest to be credited on EPF accumulations in members’ accounts for the financial year 2025–26,” the Ministry of Labour and Employment said in an official statement.