Linking of PAN and Aadhaar has been enabled now in the Income Tax portal. Every person who has been allotted a Permanent Account Number (PAN) and who is eligible to obtain an Aadhaar number, shall mandatorily link their Aadhaar and PAN on payment of fee Rs.1,000 on or before 31.3.2023. The fee payment for PAN-Aadhaar linkage need to be made through e-Pay Tax functionality available either in Income Tax portal or NSDL (now Protean) Portal. The prescribed fee must be paid under Major Head 0021 and Minor Head 500 and Assessment Year (AY) should be 2023-24 using Challan ITNS 280.

The tax-payer is suggested to link PAN-Aadhaar after 4-5 days of making the payment. If taxpayer has made any mistake while making the payment under Minor head 500, there is no provision for refund of wrong payments made.

Any mismatch in name, date of birth in Aadhaar and PAN, correct the details either in PAN or Aadhaar database such that both have matching details.

If PAN-Aadhaar is not linked, it will become inoperative. If inoperative: i) the PAN holder will not be able to file return using the inoperative PAN (ii) Pending returns will not be processed (iii) Pending refunds cannot be issued (iv) Pending proceedings as in the case of defective returns cannot be completed (v) Tax will be required to be deducted at a higher rate as PAN becomes inoperative.

In addition to the above, the tax payer might face difficulty at various other places like banks and other financial institutions, as PAN is one of the important KYC criterion for many of the financial transactions.

Aadhaar-PAN linking presently does not apply to any individual who is i) a non-resident as per the Income Tax Act, 1961, ii) of the  age of eighty years or more and iii) not a citizen of India.

—N.D. Shreenivaas, Bhavani Associates, Mysuru