PAN-Aadhaar Linking: Rules, Penalties and How to Link Under Section 139AA
If your PAN is not linked with Aadhaar, it may already be inoperative. Here is what you need to know about PAN-Aadhaar linking under Indian tax law.
WHY IS LINKING MANDATORY
Section 139AA of the Income Tax Act requires every individual who was allotted a PAN as on 1st July 2017 and is eligible for Aadhaar to link the two. The original deadline was 31st March 2022. PANs not linked by 1st July 2023 were made inoperative. Linking is still possible on payment of a late fee.
WHAT HAPPENS IF YOUR PAN IS INOPERATIVE
An inoperative PAN is not cancelled, but it becomes functionally restricted:
- Higher TDS/TCS: Under Sections 206AA and 206CC, tax may be deducted or collected at a higher rate than the applicable rate.
- Restricted ITR access: You may face limited access on the e-filing portal, affecting your ability to file returns smoothly.
- No refund processing: Pending refunds will not be processed until PAN is operative again. Interest on refunds is also not payable for the inoperative period.
- Financial transactions affected: Opening bank accounts, demat accounts and high-value transactions require an operative PAN.
WHO IS EXEMPT
- Non-residents as per the Income Tax Act, 1961
- Persons aged 80 years or above (super senior citizens)
- Non-citizens of India
- Residents of Assam, Jammu and Kashmir, and Meghalaya
HOW TO LINK PAN WITH AADHAAR
Visit the Income Tax e-filing portal at incometax.gov.in. Go to Link Aadhaar under Quick Links. Enter your PAN, Aadhaar number and name as per Aadhaar. Complete OTP verification, pay the late fee of Rs 1,000 and submit. After linking, it takes approximately 30 days for PAN to become operative again.
HOW TO CHECK STATUS
Visit incometax.gov.in and click Link Aadhaar Status under Quick Links. Enter your PAN and Aadhaar number to check.
PRACTICAL TIP
If you are salaried, check your Form 26AS or AIS. If TDS is being deducted at a rate higher than the applicable TDS rate, your PAN may be inoperative. Link it with Aadhaar and inform your employer once active. The excess TDS can be claimed as a refund when you file your ITR.
WHY IS LINKING MANDATORY
Section 139AA of the Income Tax Act requires every individual who was allotted a PAN as on 1st July 2017 and is eligible for Aadhaar to link the two. The original deadline was 31st March 2022. PANs not linked by 1st July 2023 were made inoperative. Linking is still possible on payment of a late fee.
WHAT HAPPENS IF YOUR PAN IS INOPERATIVE
An inoperative PAN is not cancelled, but it becomes functionally restricted:
- Higher TDS/TCS: Under Sections 206AA and 206CC, tax may be deducted or collected at a higher rate than the applicable rate.
- Restricted ITR access: You may face limited access on the e-filing portal, affecting your ability to file returns smoothly.
- No refund processing: Pending refunds will not be processed until PAN is operative again. Interest on refunds is also not payable for the inoperative period.
- Financial transactions affected: Opening bank accounts, demat accounts and high-value transactions require an operative PAN.
WHO IS EXEMPT
- Non-residents as per the Income Tax Act, 1961
- Persons aged 80 years or above (super senior citizens)
- Non-citizens of India
- Residents of Assam, Jammu and Kashmir, and Meghalaya
HOW TO LINK PAN WITH AADHAAR
Visit the Income Tax e-filing portal at incometax.gov.in. Go to Link Aadhaar under Quick Links. Enter your PAN, Aadhaar number and name as per Aadhaar. Complete OTP verification, pay the late fee of Rs 1,000 and submit. After linking, it takes approximately 30 days for PAN to become operative again.
HOW TO CHECK STATUS
Visit incometax.gov.in and click Link Aadhaar Status under Quick Links. Enter your PAN and Aadhaar number to check.
PRACTICAL TIP
If you are salaried, check your Form 26AS or AIS. If TDS is being deducted at a rate higher than the applicable TDS rate, your PAN may be inoperative. Link it with Aadhaar and inform your employer once active. The excess TDS can be claimed as a refund when you file your ITR.
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Disclaimer: This content is the author's personal opinion and analysis. It does not constitute professional tax or legal advice. Consult a qualified professional for specific advice on your situation.
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