What’s new?
The center has increased the deadline for PAN-Aadhar linking to June 30, which seems great. India’s population is so large that completing anything like this, where the user charges a fine of Rs. 1000, takes time. Many people are still unaware of why this linking is important and why we should execute this linking process.
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What did the center announce?
The Central Board of Direct Taxes (CBDT) has announced an extension of the deadline for linking the Permanent Account Number (PAN) with an Aadhaar to June 30, 2023. According to a press release issued on March 28, 2023, the CBDT stated that “To ensure adequate time for taxpayers, the deadline for PAN and Aadhaar linkage has been extended to 30th June 2023, allowing individuals to register their Aadhaar with the designated authority for Aadhaar-PAN linkage without fear of any negative consequences.” The update aims to provide taxpayers additional time to comply with the government’s requirements.
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Why should I link my Aadhar with Pan?
As per the regulations of the Income-tax Act of 1961 (the ‘Act’), individuals who currently possess a PAN allotted as of 1st July 2017 and are eligible to acquire an Aadhaar Number are obligated to inform the designated authority of their Aadhaar information by 31st March 2023, subject to the payment of a pre-determined fee, stated CBDT. Any failure to comply with this mandate will lead to certain consequences under the Act, effective from 1st April 2023. It added that the deadline for submitting Aadhaar details to the designated authority for linking PAN and Aadhaar has now been postponed until 30th June 2023.
What if I do not apply for the linking process?
CBDT said, “from 1st July 2023, the PAN of taxpayers who have failed to intimate their Aadhar, as required, shall become inoperative.”
Following are the consequences a taxpayer need to face if he/she fails to link their Aadhar and PAN and their PAN becomes inoperative:
- The taxpayer will no longer be liable to claim any refund against such PANs.
- They will not get any interest for the period the PAN remains inoperative.
- The rates for TDS and TCS will be charged at a higher rate as laid in the Income-tax Act, 1961.
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What to do when our PAN becomes inoperative due to the failure to link with Aadhar?
If any person is failed to link their PAN with Aadhar by 30th June 2023, the PAN becomes inoperative, and that person has to face severe consequences. But the government has also paved the way for those special category persons. The center has imposed a fine of Rs.1000 for the linking process after the deadline, and the government also said that it might take upto 30days to become the PAN re-activated again.
People who are exempted from these linking processes
The requirement of linking Aadhaar with PAN does not apply to four specific categories.
The inhabitants reside in the states of Assam, Jammu, Kashmir, and Meghalaya.
According to the Income-tax Act of 1961, individuals not residents of India but of Indian origin, commonly referred to as non-resident Indians (NRIs), are subject to certain regulations.
Individuals who have reached the age of 80 or above at any point in the preceding year are eligible under these criteria.
Individuals who do not hold Indian citizenship.
Individuals falling under the aforementioned categories are not required to link their PAN with their Aadhaar by the deadline. They do, however, have the option to voluntarily link both documents if they so desire. On the other hand, other individuals must link their Aadhaar with their PAN by the June 30 deadline.
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