The deadline to link PAN with Aadhaar card is fast approaching. The last date for linking both the documents is 31 March. In case you don’t do it, your PAN will become invalid. In the Finance Bill, 2021, passed by the Lok Sabha on Tuesday, the government has introduced an amendment under which a person will be liable to pay a late fee of up to Rs 1,000 in case of non-linking of PAN with Aadhaar.
The Finance Bill (Lok Sabha) has inserted a new Section 234H to levy a fee for default in intimating the Aadhaar number. If a person is required to intimate his Aadhaar under Section 139AA(2) and such person fails to do so, they will be liable to pay a fee, as may be prescribed, not exceeding Rs 1,000 at the time of making such intimation.
Penalty for not linking PAN with Aadhaar by March 31:
This means that if a person fails to link PAN and Aadhaar by 31 March, they will be liable to pay a fee of Rs 1,000. This fee shall be in addition to the other consequences the person has to face if PAN becomes inoperative due to non-maintenance of Aadhaar.
Remember that having an Aadhaar card is not only mandatory to get a new PAN card, but it is also a compulsory requirement for the filing of income tax returns (ITR).
How to link PAN-Aadhaar:
1. Through e-Filing website
Visit Income Tax Site
Enter the PAN, Aadhaar number, and name as mentioned in the Aadhaar card
Tick the square if only the birth year is mentioned in the Aadhaar card
Enter the Captcha code. (Visually challenged users can request for an OTP instead of the captcha code. The OTP will be sent on the registered mobile number)
Click on the 'Link Aadhaar' button.
Citizens can simply link their PAN-Aadhaar cards on the websites of Income Tax department, NSDL e-Governance Infrastructure Limited, and UTI Infrastructure Technology and Services Limited (UTIITL) by providing their PAN card number and Aadhaar number.
2. PAN-Aadhaar link SMS:
In order to link PAN-Aadhaar through SMS, send an SMS to 567678 or 56161 from your registered mobile number in the format- UIDPAN<SPACE><12 Digit Aadhaar Number><SPACE><10 Digit PAN>. For instance, UIDPAN 123456789000 EPOPE1234E. There is no charge being levied on the SMS sender by NSDL or UTI. They have to pay the SMS charges being levied by the mobile operator company.
How to check PAN-Aadhaar link status:
Visit www.incometaxindiaefiling.gov.in/aadhaarstatus
Enter PAN and Aadhaar Number
Click on 'View Link Aadhaar Status'
The status of the linking is displayed in the next screen
Consequences of not linking PAN and Aadhaar:
If you do not link your Aadhaar number with your PAN number, your PAN will become inoperative meaning thereby that you will not be able to use it after the specified date. However, the transactions done in the past using it will remain valid. Once you link both the numbers after the specified deadline, your PAN should become active. In case you have not yet filed your ITR, you will not be able to file it after the deadline is gone.
What happens if PAN card becomes inoperative?
As per rule 114AAA, in case where a person is required to furnish or intimate his PAN and the PAN is inoperative, it will be deemed that he or she has not furnished PAN. Under various provisions of the Income Tax Act if a person doesn’t furnish PAN or gives an inoperative PAN, they may have to a pay a higher TDS (tax deducted at source) or TCS (tax collected at source), and may not be able to file income tax return and may face the consequences of not filing the tax return.
If you fail to link the two documents by the deadline and your PAN becomes inoperative, it will be assumed that your PAN has not been furnished as required by the law and a penalty of Rs 10,000 may apply as per Section 272B of the Income Tax Act.
For example, if you deposit or withdraw cash above Rs 50,000, PAN card will be required. In case your PAN dies become inoperative you do not have to worry because once you link your PAN and Aadhar, the PAN becomes operative, and no penalties shall be applicable post the date of linking.
However, if you use your PAN card as an identity proof for purposes which are not related to tax such as opening a bank account, applying for a driving licence, etc., it should not attract a penalty. Complications may arise if the bank account opened using a non-functional PAN has transactions that bring it under the purview of income tax.
