PAN – Aadhaar linking mandatory by March 2023: How to link PAN and Aadhaar card

The Income Tax Department has issued a final warning for permanent account number-holders to link their number with Aadhaar card. According to the latest public advisory, if the PAN is not linked with Aadhaar before March 31, 2023, the PAN will become inoperative. Post deadline date, PAN holders will not be able to use their ten-digit unique alphanumeric number and financial transactions linked to PAN will be stopped. In addition, all the income tax pending returns will be stopped from processing.

"It is mandatory. Don't delay, link it today! As per the I-T Act, it is mandatory for all PAN-holders, who do not fall under the exempt category, to link their permanent account numbers (PAN) with Aadhaar before March 31, 2023. From April 1, 2023, the unlinked PAN shall become inoperative," reads the public advisory issued by the I-T Department.

Notably there are some residents who are exempted from PAN Aadhaar linking. Individual residing in the States of Assam, Jammu and Kashmir, and Meghalaya; a non-resident as per the Income Tax Act, 1961; of the age of eighty years or more at any time during the previous year; not a citizen of India are exempted from the process of linking PAN with Aadhaar.

Last date and fee for linking PAN-Aadhaar

The last date to link PAN with Aadhaar was extended by The Central Board of Direct Taxes (CBDT) from 31st March 2022 to 31st March 2023. However, people are required to pay a fee of Rs 1000 to initiate the linking process. According to the IT department advisory, if people fail to link PAN-Aadhaar till March 31, 2023 then their PAN number will become inoperative.

Where is PAN card needed

PAN holds a ten digit number and is necessary to initiate all financial transactions. The PAN identity of individuals is used by the IT department to track the inflow and outflow money.

The PAN number is used while paying income tax, receiving tax refunds, and receiving communication from the Income Tax Department. In addition, PAN cards are also used to initiate bigger transactions higher than Rs 50,000 like transferring money to bank, buying new vehicles and more.

Why PAN is linked with Aadhaar

1. The government has made linking of PAN and Aadhaar number mandatory under current regulations. While the linking is a process for legal requirements, the process also benefits the government and taxpayers.
2. The Aadhaar number holds all the financial information of an individual. From big money transfers to UPI, the card holds all details. And linking PAN with Aadhaar will help IT departments track and note all the transactions of taxpayers to present fraud or tax evasion.
3. Linking PAN with Aadhaar also helps in spotting people with multiple PAN cards. As residents of India only have one Aadhaar, the liking of PAN will further track that Individual only carries one PAN card in their name.
4. PAN and Aadhaar will also simplify income tax return process and verification. Since Aadhaar holds all the information about an individual including biometric verification, the linking will initiate a faster return filing process.

You can also check if your PAN is linked to Aadhaar card- Aadhaar – PAN linking: How to find out if your PAN is linked with Aadhaar card

How to Link PAN with Aadhaar

You can link your PAN-Aadhaar online or by sending an SMS to either 567678 or 56161 from your registered phone number. You can also link the two identity cards online by visiting the income tax portal and paying the late fee. To link PAN-Aadhaar online-

• Visit incometax.gov.in/iec/foportal
• Go to 'Quick Links' section, scroll and click on 'Link Aadhaar' option.
• Now enter your name, mobile number, Aadhaar number, and PAN number.
• Verify by clicking on 'I validate my Aadhaar Details' option.
• Click on 'Continue'.
• Now enter the OTP you received on your registered mobile number to validate the process.
• After paying the penalty fee your PAN will be linked to Aadhaar.