With the deadline to link PAN with Aadhaar card approaching soon, the consequences of failing to complete the process has once again come to the spotlight. The government had extended the deadline from March 31, 2023, to June 30, 2023, earlier this year. To link PAN with Aadhaar, one needs to go to www.incometax.gov.in.
Citizens linking their Aadhaar Card with PAN have to pay a penalty of Rs 1,000 currently. However, if a person fails to complete the linking before the current deadline, then there could be several consequences.
So what will happen if PAN is not linked with Aadhaar card?
Income Tax rule 114AAA says that a person who has been allotted PAN as on July 1, 2017, is required to intimate his Aadhaar number under sub-section (2) of section 139AA. Failing to do so will automatically make the PAN inoperative. This means that from July 1, if the deadline is not extended, PAN of people who have not linked their Aadhaar will become inoperative. As PAN is an important financial document, one may suffer from several difficulties due to this as the number can’t be furnished in tax documents if it becomes inoperative.
Income Tax rule 206AA states that tax collected at source (TCS) and tax deducted at source (TDS) will be higher for people who have not quoted their PAN. Filing income tax returns will also not be possible without PAN due to which one may not get due returns they were eligible for.
PAN is also required in several bank related transactions. A person needs to quote PAN for opening bank and demat accounts. Quoting PAN is also mandatory while depositing money over Rs 50,000 in a single day in bank or post office accounts.
