From 1st April 2023, you will not be able to use your PAN if it is not linked to your Aadhaar and there will be several other consequences too. While most of the PAN holders in the country have already linked to Aadhaar, some are yet to do that.
“As per Income-tax Act, 1961, it is mandatory for all PAN holders, who do not fall under the exempt category, to link their PAN with Aadhaar before 31.3.2023. From 1.04.2023, the unlinked PAN shall become inoperative,” the Income Tax Department tweeted recently.
Through a notification dated 11th May 2017, the Central Board of Direct Taxes (CBDT) requested PAN holders to link their PAN with their Aadhaar. The deadline for PAN-Aadhaar linking has been extended several times in past. The latest due date for PAN-Aadhaar linking was March 31, 2022.
Anyone who failed to link PAN-Aadhaar by 31st March 2022 can still do so by paying a fee of Rs 1000 under Section 234H, according to the Income Tax Department. Till 30th June 2022, the late fee for PAN-Aadhaar linking was Rs 500.
“As per CBDT circular F. No. 370142/14/22-TPL dated on 30th March 2022, every person who has been allotted a PAN as on 1st July 2017 and is eligible to obtain Aadhaar number is required to link PAN with AADHAAR on or before 31st March, 2022. Taxpayers who failed to do so are liable to pay a fee of Rs. 500 till 30th June, 2022 and thereafter a fee of Rs. 1000 will be applicable before submission of PAN-AADHAAR linkage request,” the Income Tax Department says on its website.
You can still link your PAN with a valid Aadhaar after paying a fee of Rs 1000. However, this facility will be available only till March 31, 2023, failing which your PAN will become inoperative.
What happens if you do not link your Aadhaar and PAN?
If you fail to link Aadhaar and PAN within the due date, you may have to face the below-mentioned consequences:
- PAN becomes inoperative
If an individual does not link PAN to Aadhaar within the due date, his/her PAN will become inoperative. Once PAN becomes inoperative, it will not be possible to furnish, intimate, or quote the PAN number anywhere. This may further result in:
- Higher tax rate applied for income tax purposes
- Higher TDS collection
- Inability to file income tax returns, which can further attract interest, penalty and even prosecution as a result of not furnishing details of income generated
- Penalty for not quoting PAN during certain financial transactions
- PAN-Aadhaar interchangeability is not allowed
If Aadhaar is linked to an individual’s PAN, the Income-tax act allows the interchangeability of both. This means a person can quote either Aadhaar or PAN where needed. However, if these are not linked, the interchangeability of these numbers will not be permitted.
Additionally, since PAN will become inoperative in the case of non-linking to Aadhaar, an individual will not be able to quote Aadhaar in lieu of PAN or vice versa.
- Penalty under Section 234H
- In case an individual fails to link Aadhaar to PAN by the due date, he/she will be held liable for charges of up to Rs. 1,000 for while requesting for linking of PAN with Aadhaar.
- A penalty of Rs. 10,000 will be applicable for non-filing of returns of income.
HOW TO LINK PAN WITH AADHAAR?
a) Go to Income Tax e-filing portal: https://eportal.incometax.gov.in
b) You will find the ‘Link Aadhaar Status’ option under Quick Links.
c) A nominal fee of ₹ 1000 would be applicable for linking of PAN with Aadhaar done after 30th June
2022 to be paid to Income Tax Department on its website.
No documents are required to be submitted as proof to link PAN with Aadhaar online.
HOW TO CHECK AADHAAR-PAN LINKING STATUS?
a) Go to Income Tax e-filing portal: https://eportal.incometax.gov.in/iec/foservices/#/pre-
login/link-aadhaar-status
b) Enter your PAN & Aadhaar number
c) Click on ‘View Link Aadhaar Status’
WHO ARE NOT REQUIRED TO OBTAIN AADHAAR?
Individuals from Assam, Meghalaya, and Jammu & Kashmir
Super Senior Citizens (80 years and above)
Non-resident taxable person
Individuals who are not citizens of India
Frequently Asked Questions (FAQs)
When will PAN become inoperative?
PAN will become inoperative from 1st April 2023 if it is not linked to Aadhaar.
Can I still link my PAN with my Aadhaar?
Yes. You can still link your PAN with a valid Aadhaar by paying a fee of Rs 1000. This facility will be available only till 31st March 2023.
What is the last date of PAN-Aadhaar linking by paying Rs 1000 fine?
31st March 2023 is the last date for linking PAN-Aadhaar by paying a fee of Rs 1000.
How to pay the Rs 1000 fine
You can make the payment for PAN-Aadhaar linking through the e-Pay Tax functionality enabled on the e-filing portal.
Where to link PAN-Aadhaar?
You can link your PAN with a valid Aadhaar number by visiting the Income tax website – http://www.incometax.gov.in.
Why PAN-Aadhaar linking is important?
If your PAN becomes inoperative, you will become liable for all the consequences for not furnishing/intimating/quoting PAN in all transactions where you are required to provide PAN.
When will the consequences of inoperative PAN come into effect?
As per CBDT, all the consequences of PAN becoming inoperative will come into force from April 1, 2023.