Highlights:
- The deadline for linking PAN with Aadhaar has been extended from September 30th, 2021 to March 31st, 2022.
- Failure to link PAN with Aadhaar would result in higher TDS and a Rs 10,000 penalty under Section 272B of the Income Tax Act.
- PAN Card is required to meet KYC norms for banks, clearing houses, e-wallets etc.
The Central Board of Direct Taxes (CBDT) has extended the deadline for linking Aadhaar to PAN to March 31, 2022. The government has already extended the deadline for seeding PAN with the Aadhaar card as part of Covid relief measures.
“The time limit for notification of Aadhaar number to the Income-tax Department for linking of PAN with Aadhaar has been extended from 30th September 2021 to 31st March 2022,” the direct tax body stated recently in a statement.
In addition, the deadline for completing penalty actions under the I-T Act has been extended from September 30, 2021 to March 31, 2022. Furthermore, the time limit for the Adjudicating Authority to provide notice and issue an order under the Prohibition of Benami Property Transactions Act, 1988 has been extended to March 2022.
Even if you miss the deadline, you may still link your PAN and Aadhaar, but there will be a Rs 1,000 fine and other consequences.
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Consequences of not linking PAN and Aadhaar:
Individuals who do not link their Aadhaar card to a PAN card by March 31, 2022 risk losing the use of their PAN card. It should be highlighted that a PAN Card is required to meet Know Your Customer (KYC) obligations imposed for clearing houses, banks, and even e-wallets. If a PAN card is lost or stolen, all of these services would be disrupted.
In short, failing to link your PAN to Aadhar beyond the due date is equivalent to not having a PAN card, a scenario that can be detrimental to your financial health.
An inoperative PAN card will have an impact on one’s bank account savings, as well as the interest received on one’s bank account savings. In the case that a bank is not linked to a PAN Card, the TDS (Tax Deduction at Source) charged on interest exceeding Rs 10,000 per year would be doubled to 20%. The TDS on interest earned above Rs 10,000 for bank accounts linked to a PAN card is 10%.
In addition, if you fail to connect the two documents by the timeframe and your PAN becomes inoperative, a penalty of Rs 10,000 may apply under Section 272B of the Income Tax Act, and it would be deemed that your PAN has not been given as required by law.
The PAN allows the Income Tax Department to link all of the assessee’s transactions with the department. Tax payments, income returns, TDS/TCS credits, defined transactions, correspondence, and so on are some of these transactions. It allows for the quick retrieval of assessee information as well as the matching of various investments, borrowings, and other assessee business activity.
How to Link PAN to Your Aadhaar Card:
You can use the income tax department’s e-filing portal to link your PAN with Aadhaar. On the left, go to the Link Aadhaar section. You must enter your PAN number, Aadhaar number, and name. Complete the CAPTCHA. When you click the ‘Link Aadhaar’ button, your PAN Aadhaar linking will be completed. The I-T department will confirm your name, date of birth, and gender against your Aadhaar information before linking them.
