PAN-Aadhaar Linking: What Will Happen If You Miss The Deadline? 5 Key Things Taxpayers Must Know

“CBDT amends Income Tax Rules,1962 for prescribing fee u/s 234H of IT Act,1961. The window of opportunity provided to taxpayers upto 31st March 2023, vide Notification No. 17/2022 dt 29/03/2022 for intimating Aadhaar on payment of a certain fee. Circular No. 7/2022 dt 30/3/2022 issued”, Income Tax India said.

CBDT amends Income Tax Rules,1962 for prescribing fee u/s 234H of IT Act,1961. Window of opportunity provided to taxpayers upto 31st March,2023, vide Notification No. 17/2022 dt 29/03/2022 for intimating Aadhaar on payment of certain fee. Circular No. 7/2022 dt 30/3/2022 issued. pic.twitter.com/oqSHSyFHro

— Income Tax India (@IncomeTaxIndia) March 30, 2022

PAN-Aadhaar Linking: 5 Things Taxpayers Must Know

1. In order to mitigate the inconvenience to taxpayers, as per notification dated March 29, 2022, a window of opportunity has been provided to taxpayers up to March 31, 2023, to intimate their Aadhaar to the prescribed authority for Aadhaar-PAN linking without facing repercussions, the CBDT said, adding such intimation would have to be accompanied by late fees.
2. PAN, not linked to Aadhaar, would become “inoperative” after March 31, 2023.
3. If the PAN of a person has become inoperative, he will not be able to furnish, intimate, or quote his PAN and shall be liable to all the consequences under the Act for such failure.
4. This will have a number of implications, such as:-
   (i) The person shall not be able to file a return using the inoperative PAN
   (ii) Pending returns will not be processed
   (iii) Pending refunds cannot be issued to inoperative PANs
   (iv) Pending proceedings as in the case of defective returns cannot be completed once the PAN is inoperative
   (v) Tax will be required to be deducted at a higher rate as PAN becomes inoperative
5. The taxpayer might face difficulty at various other fora like banks and other financial portals, as PAN is one of the important KYC criteria for all kinds of financial transactions.