What is Form 121?

When you earn interest from bonds, the company paying you is required by law to deduct TDS (Tax Deducted at Source) before crediting your account. This means you get less money than you should — and then have to claim it back when filing your taxes.

Form 121 is a simple declaration you submit to the bond issuer that says: "My total income is below the taxable limit — please don't deduct TDS on my interest." Once filed, the bond issuer stops deducting TDS on your future interest payouts. You keep your full returns, without waiting for a tax refund.