PAN-Aadhaar linking: What happens if both are not linked by March 31?
The tax department has been putting out regular reminders regarding the same on its official Twitter handle. The department tweeted saying that it was "mandatory" to link PAN with Aadhaar and advised people not to "miss" the stipulated deadline ...
The Income Tax (I-T) Department has been tweeting regular reminders regarding the same from its official Twitter handle. On March 16, the tax department tweeted saying that it was "mandatory" to link PAN with Aadhaar and advised people not to "miss" the stipulated deadline of March 31.
Don't miss the deadline! It is mandatory to link your PAN and Aadhaar before 31st March, 2020. You can do it thro… https://t.co/Kb81W0HKDS— Income Tax India (@IncomeTaxIndia) 1584353569000
Here is a look at what will happen if you do not link your PAN with Aadhaar before March 31.
- What will happen if PAN is not linked with Aadhaar?
According to CBDT, if PAN becomes inoperative with effect from April 1, 2020, you will not be able to use your PAN to conduct financial transactions wherever quoting of PAN is mandatory. Some of these financial transactions include opening of a bank account, investing in a fixed deposit, filing of income tax returns etc.
Further, once the PAN becomes inoperative, it will be deemed that a person does not have a PAN. However, in case PAN becomes inoperative, then it will not affect the financial transactions undertaken by an individual retrospectively. This is because Budget 2019 presented in July, amended the law on the same. Prior to the new law, if PAN is not linked with Aadhaar, then it would be deemed as PAN would become invalid and this would have impacted the financial transactions undertaken by an individual retrospectively. To protect the validity of such transactions, the law was amended.
- Will my PAN become operative if I link it after April 1, 2020?
An individual can also check if their PAN is linked with Aadhaar on the e-filing website of the income tax department. However, to avoid the inconvenience, it is advisable to link the same before the deadline.
Dr. Suresh Surana, Founder, RSM India says, "If the aadhar is not linked with PAN, then the PAN would become inoperative. Quoting inoperative PAN shall be treated as non-furnishing of PAN for specified transactions, where PAN is required to be quoted (Purchase of Property / Purchase of Mutual funds / furnishing of tax return, etc). There is also a penalty of Rs. 10,000 prescribed under section 272B which could be levied by the income tax authorities. The window for linking aadhar with PAN is also available after the deadline of 31st March 2020, wherein the PAN shall become operative from the date of intimation of the Aadhar by taxpayer."
- What if I quote my inoperative PAN?
- Process of linking PAN with Aadhaar
- Individuals exempted from linking PAN with Aadhaar
a) Individuals residing in the States of Assam, Jammu and Kashmir and Meghalaya
b) Individuals who are non-resident as per the Income-tax Act, 1961
c) Individuals who are of the age of eighty years or more at any time during the previous year
d) Individuals who are not a citizen of India"