Tillie Doyle
Linking your Aadhaar with your PAN is a mandatory process for all Indian residents who have been allotted a Permanent Account Number (PAN) and are eligible for an Aadhaar number. This process is important as it allows your income tax returns to be processed. For new applicants of a PAN card, the Aadhaar PAN linking is done automatically during the application stage. However, for existing PAN holders, it is mandatory to link PAN with Aadhaar by the specified deadline, which was previously set as 30th June 2023. Failure to do so will result in the PAN becoming inoperative, leading to various restrictions and higher tax deduction rates. The linking process can be completed online through the Income Tax e-Filing Portal, with steps including entering your PAN and Aadhaar numbers, validating your details, and making any necessary payments. It is important to note that you should not share your Aadhaar number openly on social media or other public platforms.
| Characteristics | Values |
|---|---|
| Mandatory | Yes |
| Deadline | 30 June 2023 |
| Applicable to NRIs/PIOs | Yes |
| Applicable to those without Aadhaar | No |
| Fee | Free |
| Penalty for delay | Rs.1,000 |
| Process | Online via e-Filing Portal |
| Steps | Enter PAN, Aadhaar, name, mobile number, OTP |
| Payment | e-Pay Tax |
| Verification | Via OTP |
| Status check | On NSDL site after 24 hours |
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What You'll Learn
Deadlines for linking Aadhaar and PAN
The deadline for linking PAN with Aadhaar was June 30, 2023. Any PAN not linked to Aadhaar by this date was classified as inactive as of July 1, 2023, and taxpayers who missed the deadline must pay a penalty to reactivate their PAN and complete the linkage process. There are rumours of an extended deadline of December 31, 2024, but this has not been officially confirmed by the government.
The consequences of not linking PAN with Aadhaar by the deadline include the PAN being mapped as "inoperative" at NSDL, which can significantly disrupt financial and tax-related activities. This includes difficulties in filing income tax returns, accessing banking services, and conducting high-value transactions. It is also mandatory to mention the Aadhaar card number when applying for a new PAN card, so it can be challenging to obtain a new PAN if the old one is lost or damaged.
To reactivate an inoperative PAN, taxpayers must pay a late penalty of Rs. 1,000 under Section 234H of the Income Tax Act, 1961. This payment must be made before filing for the PAN-Aadhaar link on the Income Tax website, and taxpayers must ensure they have a valid PAN number and Aadhaar number to pay the penalty. Once the penalty is paid, the PAN card will be linked with the Aadhaar card and become operative within 7-30 days.
It is important to note that citizens who obtained their PAN card after October 1, 2024, on the basis of an Aadhaar enrolment ID, are not subject to the effects of PAN becoming inoperative and do not need to pay any penalty to link PAN-Aadhaar by December 31, 2025.
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How to link Aadhaar and PAN online
It is mandatory to link your PAN with your Aadhaar. This process is important as it allows your income tax returns to be processed. For new applicants of the PAN card, the Aadhaar PAN linking is done automatically during the application stage. However, for existing PAN holders, it is mandatory to link PAN with Aadhaar. If you do not link your PAN with Aadhaar, your PAN will become inoperative.
To link your Aadhaar with your PAN online, follow the steps below:
Step 1: Visit the e-Filing Portal
- Go to the Income Tax e-filing portal.
- Under the Quick Links section, click on the 'Link Aadhaar' option.
- Alternatively, you can log in to the e-filing portal and click on 'Link Aadhaar' in the 'Profile' section.
Step 2: Enter your details
- Enter your PAN and Aadhaar number.
- Enter your name as per your Aadhaar card.
- If your date of birth is mentioned on your Aadhaar card, tick the box.
- Enter your mobile number to receive the OTP.
Step 3: Validate and submit
- Click on 'Validate' or 'Continue' to submit your request.
- You will receive an OTP on your mobile number. Enter this OTP and click 'Validate' again.
- Your request for PAN-Aadhaar linking will be sent for validation.
Step 4: Payment
- After validation, you may see a pop-up message stating "Payment details not found".
- Click on 'Continue to Pay Through e-Pay Tax' to pay the fee.
- Select the mode of payment and make the payment.
- After payment, you can submit your request for linking.
Step 5: Check status
- After submitting your request, you can check the status of your PAN-Aadhaar link.
- On the e-Filing Portal homepage, under Quick Links, click on 'Link Aadhaar Status'.
- Enter your PAN and Aadhaar number and click on 'View Link Aadhaar Status'.
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What to do if your PAN is inoperative
As per the 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. The deadline for this linkage was June 30, 2023, and non-compliance will render the PAN inoperative.
If your PAN has become inoperative, you can still reactivate it by following these steps:
- Visit the official website of the Income Tax Department: incometax.gov.in/iec/foportal/
- Navigate to the 'e-Pay Tax' section to submit the Aadhaar-PAN linking request
- Enter your PAN details and look for CHALLAN NO./ITNS 280 to submit the linking request
- Make the payment of the required fee under Minor Head 500 (Fee) and Major Head 0021 [Income Tax (Other Than Companies)] in a single challan
- Enter the Captcha code and click on the Proceed tab
Please note that the Income Tax Department will allow you to file income tax returns (ITRs) even with an inoperative PAN. However, they will not process your return until your PAN and Aadhaar are linked. Additionally, there are several consequences to having an inoperative PAN, including the inability to open a bank account, invest in certain financial products, and higher tax deduction rates on savings interest.
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$64.54
Why linking Aadhaar and PAN is mandatory
The Indian government has made it mandatory for every individual who has been allotted a PAN (Permanent Account Number) and is eligible to obtain an Aadhaar number to link the two. This was introduced as law in the Union Budget of 2017. The last date to link PAN with Aadhaar without having to pay a fee was March 31, 2022. If the linking of the two is done on or after July 1, 2023, then a fee of Rs 1000 will be payable.
The consequences of not linking the two are that the PAN will become inoperative, and the individual will not be able to conduct financial transactions wherever quoting of PAN is mandatory. These include opening a bank account, filing income tax returns, claiming an income tax refund, investing in stocks, mutual funds, etc. As per Section 139 AA of the Income Tax Act 1961, non-linking of PAN with Aadhaar shall make PAN "inoperative", and TDS/TCS would be deducted/collected at a higher Non PAN rate (including cash withdrawal).
The process of linking the two is straightforward. One can visit the e-filing website and click on 'Link Aadhaar'. A new form will appear where one is required to enter the PAN, Aadhaar number, name as per Aadhaar, and mobile number. Once submitted successfully, a message will confirm that the PAN is successfully linked to Aadhaar.
It is important to note that the Unique Identification Authority of India (UIDAI) has advised people not to share their Aadhaar number openly in the public domain, especially on social media or other public platforms.
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What to do if payment details are not verified
If your payment details are not verified on the e-Filing Portal, you will see a pop-up message saying "Payments details not found". In this case, you should click on "Continue to Pay Through e-Pay Tax" as the payment of the fee is a prerequisite to submitting the Aadhaar PAN link request. If you have already paid the fee, wait for 4-5 working days before submitting the request.
If you are experiencing issues with linking your Aadhaar and PAN because the information on one document does not match the other, you can update your PAN details online or offline. For the online method, visit a nearby Aadhaar Enrolment Centre, fill out the Aadhaar Enrolment/Correction Form, submit the form, provide your biometrics for authentication, and pay a fee of Rs. 30. Once your application is accepted, you will be given an acknowledgement slip containing the Update Request Number (URN) to track the status of your PAN application. After your details have been updated, you can download the e-Aadhaar from UIDAI's website and link your PAN with Aadhaar.
For the offline method, download the form, fill it out manually, and submit it to the TIN centre along with the required document proof. If your Aadhaar is linked with a PAN that does not belong to you, you will have to visit a PAN centre and submit an application to the PAN officer to get it delinked. This process can take up to 30 days.
If your PAN is not linked to your Aadhaar by 30 June 2023, your PAN will become inoperative. You can reactivate your PAN by paying a late penalty fee of Rs. 1,000 and submitting a request to link your PAN with Aadhaar.
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Frequently asked questions
You can link your PAN with Aadhaar on the e-Filing Portal. Visit the homepage and click on 'Link Aadhaar' in the Quick Links section. Enter your PAN and Aadhaar numbers and click 'Validate'.
As per the Income Tax Act, your PAN will become inoperative if you do not link it with Aadhaar. This will result in consequences such as the refund of any amount of tax not being made, interest not being payable on such refunds, and tax being deducted at a higher rate.
Yes, linking your PAN with Aadhaar is safe. UIDAI does not have visibility of the linking of your Aadhaar with any other services, and departments such as banks and income tax do not share any information of the Aadhaar number holder.
You can make your PAN operative by paying a fee of Rs.1000 and intimating your Aadhaar number. You should carry your PAN, Aadhaar, and fee paid challan copy to the dedicated centres of PAN Service Providers.
You can still use your Aadhaar to prove your identity and do transactions. However, if the name difference is preventing you from linking your PAN and Aadhaar, you may need to contact the relevant authorities for assistance.
