Aadhaar-Pan Linking: Penalty And Fines

The Indian government has made it mandatory to link your Aadhaar with your PAN card to make finances clearer and prevent tax evasion. The last date to do so was June 30, 2023, and failure to meet the deadline will result in a fine of Rs.1,000. The fine must be paid before filing for the PAN-Aadhaar link on the Income Tax website.

The fine for not linking PAN with Aadhaar is Rs.1,000

The Indian government has made it mandatory to link your Aadhaar with your PAN card. The last date for linking PAN with Aadhaar was June 30, 2023. If you missed the deadline, your PAN card will stop working and will be classified as 'inoperative'. You will have to pay a late fee of Rs.1,000 to make your PAN operative again.

If you don't link your PAN with Aadhaar, your PAN card will become inoperative. You will face the following consequences:

• You will not get a refund of any amount of tax due under the provisions of the Income Tax Act.
• No interest will be payable to you on such a refund.
• Tax will be deducted at a higher rate.
• You may not be able to file income tax returns (ITR) without PAN.
• You won't be able to carry out several bank transactions that require PAN details.

You can still link your PAN with your Aadhaar after the deadline by following these steps:

• Visit the Income Tax e-Filing Portal.
• Click on the 'e-Pay Tax' option under the 'Quick Links' heading.
• Enter your PAN number and mobile number and click 'Continue'.
• After OTP verification, click on 'Income Tax' and then 'Proceed'.
• Select the relevant assessment year and 'Other Receipts (500)' as the type of payment.
• The applicable amount of Rs.1,000 will be pre-filled. Click 'Continue' and make the payment.
• After making the payment, follow the steps to link your PAN with Aadhaar on the same portal.

Who is exempt from linking PAN with Aadhaar?

The following categories of individuals are exempt from linking their PAN with Aadhaar:

• Individuals residing in the states of Jammu and Kashmir, Assam, and Meghalaya.
• Non-residents as per the Income-tax Act, 1961.
• Individuals aged 80 years or above.
• Individuals who are not citizens of India.

The deadline to link PAN with Aadhaar was June 30, 2023

The Indian government has made it mandatory to link Aadhaar with PAN, with certain exceptions for NRIs, non-citizens, those over 80, and people living in Assam, Jammu & Kashmir, or Meghalaya. The deadline for this was June 30, 2023, and failure to do so will result in your PAN becoming inoperative.

If you missed the deadline, you can still link your PAN and Aadhaar, but it will cost you a penalty fee of Rs. 1,000. This can be done by following these steps:

• Login to the Income Tax e-filing portal.
• On the Dashboard, in the Profile Section, click on 'Link Aadhaar'.
• Enter your PAN and Aadhaar Number.
• Click on 'Continue to Pay Through e-Pay Tax'.
• Enter your PAN and mobile number to receive an OTP.
• After OTP verification, you will be redirected to the e-Pay Tax page. Click on the 'Proceed' button.
• Select AY 2024-25 and the Type of Payment as 'Other Receipts (500)'. Click on 'Continue'.
• Make the payment of Rs. 1,000.
• Submit the Aadhaar linking request on the e-Filing portal.

Once the payment is made, it can take up to 30 days for your PAN to become operational again.

PAN cards that are not linked become inoperative

The Indian government has made it mandatory for everyone to connect their PAN (Permanent Account Number) with their Aadhaar, with certain exceptions for NRIs, non-citizens, those over 80, and people living in Jammu and Kashmir, Assam, and Meghalaya. This policy seeks to reduce tax evasion by giving each taxpayer a distinct identification number.

If you miss the deadline of June 30, 2023, to link your PAN and Aadhaar, your PAN card will stop functioning. It will become inoperative, and you will not be able to provide your PAN number for financial transactions. This includes opening a bank account, issuing debit/credit cards, purchasing mutual funds, cash deposits over Rs. 50,000 in a day, and more.

• Applying a higher tax rate on income taxes
• Increased TDS gathering
• Inability to complete income tax forms, which may result in additional interest charges, fines, and legal ramifications if information about earned income is withheld
• Penalties for failing to quote PAN in certain banking transactions
• PAN and Aadhaar cannot be used interchangeably if they are not linked
• The IT department may reject the ITR when PAN and Aadhaar are not linked
• It will be difficult to access government services such as applying for a passport, obtaining subsidies, and opening a bank account
• Getting a new PAN card will be difficult if the old one is lost or damaged, as it is mandatory to mention the Aadhaar card number when applying for a new PAN

You can link your PAN with your Aadhaar by visiting the e-filing portal of the Income Tax Department and following the instructions.

If you do not link your PAN with your Aadhaar by the deadline, you will have to pay a late penalty of Rs. 1,000.

The consequences of an inoperative PAN include higher taxes and fines

The Indian government has made it mandatory for everyone to link their PAN (Permanent Account Number) with their Aadhaar, with certain exceptions for NRIs, non-citizens, those over 80, and people living in specific areas. The deadline for this was 30 June 2023. If you miss the deadline, your PAN card will stop functioning and will be considered inoperative.

The consequences of an inoperative PAN include:

• Higher taxes: An inoperative PAN will result in a higher tax rate being applied to income tax and higher TDS collection.
• Fines: There is a penalty of Rs. 1,000 for failing to link PAN and Aadhaar. Additionally, a penalty of Rs. 10,000 will be charged for non-filing of income tax returns.
• Inability to file income tax returns: This may further attract interest, penalties, and even prosecution as a result of not furnishing details of income generated.
• Inability to complete certain financial transactions: An inoperative PAN will impact the ability to open a bank account, issue debit/credit cards, purchase mutual funds, make cash deposits over Rs. 50,000 in a day, and more.
• Loss of tax credits: The TCS/TDS credit will not appear in Form 26AS, and TCS/TDS certificates will not be available.

Exempt categories do not need to link PAN with Aadhaar

The Indian government has made it mandatory for everyone to connect their PAN (Permanent Account Number) with their Aadhaar. However, there are certain groups that are exempt from this rule. These include:

• Individuals residing in the states of Jammu and Kashmir, Assam, and Meghalaya.
• Non-resident Indians (NRIs) as per the Income Tax Act 1961.
• People aged 80 years or more (Super Senior Citizens).
• Individuals who are not citizens of India.

The exemptions provided are subject to modifications depending on subsequent government notifications on this subject.

Frequently asked questions