Individuals planning to withdraw from their provident fund (PF) accounts in the financial year 2026-27 must be aware of a new compliance requirement under the Income-tax Act, 2025. From April 1, 2026, Form 121 must be submitted to declare a zero tax liability to avoid tax deducted at source (TDS) on eligible withdrawals. Previously, individuals used Form 15G or Form 15H for similar declarations, but these have been replaced by Form 121, which serves as a self-declaration indicating that the estimated total income is below the taxable limit. Failure to submit this form may result in TDS deductions, even if the individual’s final tax liability is nil. TDS typically applies to PF withdrawals made before completing five years of continuous service or when there is a mismatch in PAN records. Timing is crucial; the form should ideally be submitted before initiating the withdrawal or at the beginning of the financial year. Currently, Form 121 is not fully digitized, necessitating physical submission, which increases the risk of errors. Such errors can lead to unnecessary TDS deductions, affecting liquidity and cash flow for individuals relying on PF withdrawals for urgent needs.