The Indian government has announced an extension of the deadline for linking PAN (Permanent Account Number) with Aadhaar (Unique Identity Number) until 30 June 2023. The earlier deadline was 31 March 2022. The extension has been made to provide more time for taxpayers to complete the linking process. It is mandatory for taxpayers to link their PAN with their Aadhaar for filing income tax returns. Failure to do so can result in a penalty. Taxpayers are advised to complete the linking process before the new deadline to avoid any inconvenience.
For Indian citizens, the Permanent Account Number (PAN) card and the Aadhaar card are essential documents of identification. PAN cards are issued by the Income Tax Department (IT), while Aadhaar cards are issued by the Unique Identification Authority of India (UIDAI).
An individual’s or business’s PAN is used for tax purposes. All residents are issued an Aadhaar number, which is a 12-digit unique identification number. PAN and Aadhaar cards must, however, be linked by the IT department. Let’s learn to Pan Aadhaar Link online.
Circular on PAN Aadhaar Link
PAN holders (except those who fall under the exempt category) are required to link their PAN with their Aadhaar by 30 June 2023 in accordance with a circular issued by the IT department. PAN-Aadhaar was initially mandated to be linked by 31 March 2022 but was then extended to 30 June 2022 by the IT department. However, those who linked their PAN-Aadhaar between 1 July 2022 and 30 June 2022 were required to pay a fine of ₹500.
As a result, the IT department extended the deadline for linking PAN to Aadhaar to 30 June 2023. PAN holders who link their PAN to their Aadhaar between 1 July 2022 and 30 June 2023 must pay a penalty of ₹1,000. The PAN card will become inoperative on 1 July 2023 if it is not linked with the Aadhaar card. To regulate and curb tax evasion, the IT department has mandated the Pan Aadhaar Link.
Who Falls under the Exempt Category for PAN Aadhaar Link?
Exempt individuals are not required to link their PAN with their Aadhaar by 30 June 2023. Following is a list of exempt categories:
- Residents of Jammu and Kashmir, Assam, and Meghalaya.
- According to the Income-tax Act of 1961, a non-resident is a taxable person.
- People aged more than 80 years (Super Senior Citizens).
- Persons who are not citizens of India.
Importance of linking PAN with Aadhaar card
- When a PAN card is not linked to an Aadhaar number, it becomes inoperative.
- The linking of the PAN and Aadhaar is required when filing an Income Tax Return (ITR). When PAN and Aadhaar are not linked, the IT department may reject the ITR.
- A PAN and Aadhaar card is required in order to obtain government services, such as obtaining a passport, applying for subsidies, and opening a bank account. Government services are difficult to access when
- It may be difficult to obtain a new PAN card if the old one has been damaged or lost because it is mandatory to include the Aadhaar number when applying for a new PAN card if the PAN-Aadhaar is not linked.
Consequences of not Linking PAN with Aadhaar Card
In the event that the PAN-Aadhaar cards are not linked within the last date, it becomes inoperative, as a result of which:
- A taxpayer with an inoperative PAN card cannot file an ITR or claim an ITR.
- Pending returns will not be processed, and refunds on inoperative PAN cards will not be issued.
- TCS/TDS will be applied at a higher rate.
- TCS/TDS credit will not appear on Form 26AS, and TCS/TDS certificates will not be available.
- In the event of a nil TDS, taxpayers will not be able to submit 15G/15H declarations.
- The following transactions cannot be done since the PAN card will be inoperative:
- Obtain a bank account.
- The issuance of debit and credit cards.
- The purchase of a mutual fund unit exceeding ₹50,000.
- A deposit of more than ₹50,000 in cash is made with a bank or post office during a single day.
- A bank draft or pay order purchased in cash in excess of ₹50,000 in one day.
- In a financial year, a time deposit with a bank, Nidhi, non-banking financial corporation (NBFC), etc., exceeds ₹50,000 or amounts to more than ₹2,50,000.
- An amount exceeding ₹50,000 in a financial year for one or more prepaid payment instruments as defined by the Reserve Bank of India (RBI).
- An individual who sells or purchases goods or services for more than ₹2,00,000 in a single transaction.
On the other hand, the PAN may be reinstated after 30 days upon the intimation of the Aadhaar number to the prescribed authority after payment of a fee of ₹1,000.
Penalty for Non-linking of PAN with Aadhaar Card
The penalty for linking PAN and Aadhaar was previously ₹500. At present, taxpayers are required to link PAN-Aadhaar by 30 June 2023 by paying a late penalty of ₹1,000. Therefore, they must pay the penalty before applying for the PAN-Aadhaar link on the Income Tax website. For the penalty to be paid, they must have a valid PAN number, Aadhaar number, and mobile number.
In order to pay the penalty for linking your PAN to your Aadhaar number, please follow the following steps:
- Go to the TIN website
- Click on “Non-TDS/TCS” under “Challan no./ITNS 280.”
- Choose “(0021) Income Tax (other than companies)” for the tax option and “500 (Other Receipts)” for the payment option
- Select mode of payment (net banking or debit card)
- Enter the required details (PAN, assessment year, address, email, mobile number, captcha code)
- Click “Proceed” to make the payment
- Send a request to link PAN-Aadhaar after 4-5 days.
How to Link a PAN with an AADHAAR Card?
Following the steps below, taxpayers can link their PAN with their Aadhaar after four to five days of paying the penalty:
- Go to the Income Tax e-filing portal.
- Click on the ‘Link Aadhaar’ option under ‘Quick Links’ on the left-hand side of the homepage.
- Enter PAN and Aadhaar Number and click ‘Validate’.
- Once penalty payment is verified, click ‘Continue’.
- Enter required details and click the ‘Link Aadhaar’ button.
- Enter OTP received on the mobile number.
- Pan Aadhaar Link request will be submitted successfully.
Alternatively, visit a PAN card centre, fill out the form and submit photocopies of PAN and Aadhaar cards for Pan Aadhaar Link.
