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PAN card-Aadhaar linking: Why it is mandatory? Know How to link PAN with Aadhaar
PAN card-Aadhaar linking: The Central Board of Direct Taxes (CBDT) has asked all taxpayers to link their PAN to their Aadhaar by March 31, 2023. Noncompliance will result in the PAN becoming inactive on April 1, 2023.
The Securities and Exchange Board of India (SEBI) also directed investors on Wednesday to link their PAN with their Aadhaar by the end of this month in order to continue doing transactions in the securities market.
The Income-tax Department announced the linking of PAN with Aadhaar after discovering instances where multiple permanent account numbers (PANs) were allotted to one person, or where one PAN was allotted to more than one person.
According to a Central Board of Direct Taxes (CBDT) circular dated March 30, 2022, “Rule 114AAA of the Income-tax Rules provides that if a person’s PAN has become inoperative, he will not be able to furnish, intimate, or quote his PAN and shall be liable to all the consequences under the Act for such failure.”
Who needs to link their PAN to their Aadhaar?
Linking of the Permanent Account Number (PAN) to an Aadhaar is mandatory as per Section 139AA of the Income Tax Act, 1961. This requirement applies to individuals who possess a PAN and an Aadhaar number by the March 31 deadline.
Who is exempt from linking their PAN to their Aadhaar?
There are a few groups of people who are exempt from this requirement.
- Any person over the age of 80
- According to the Income-tax Act, a non-resident;
- A person who is not an Indian citizen.
What happens if your PAN is not linked to your Aadhaar?
According to the CBDT, if a person fails to link his or her PAN with Aadhaar, the PAN will become inactive. In such a case, the person will be unable to provide, notify, or quote his/her PAN and will be subject to all of the consequences outlined in the Income-tax Act for such failure. Noncompliance has the following major consequences:
Aside from these consequences, the individual may encounter difficulties in conducting other financial transactions, such as those with banks, because PAN is an important KYC criterion for these transactions.
Steps to link PAN with Aadhaar
- Visit the income tax website.
- In the quick link section, select the ‘Link Aadhar’ option.
- Enter your Aadhaar number and PAN, and pay the Rs 1000 late fee via the ePay tax functionality after following the on-screen instructions.
- Verify the information by checking the box next to ‘I agree to validate my Aadhaar details’ and then clicking the ‘Link Aadhaar’ button.
- Enter the OTP received on your mobile number and click ‘Validate’ to finish the linking process.
Steps to check Aadhaar-PAN linking status
- Visit the income tax e-filing website.
- Select the ‘Link Aadhaar Status’ option from the Quick Links menu.
- Enter your PAN and Aadhaar number, then select ‘View Link Aadhaar Status’.
- The website will display a message indicating whether your Aadhaar and PAN are linked or not.
