PAN or Permanent Account Number is a unique 10-digit alphanumeric code produced and assigned by the Income Tax Department. Whereas, Aadhaar is a 12-digit unique identity number produced and assigned by UIDAI or the Unique Identification Authority of India. The Government has made it mandatory to link both these documents with each other. Not completing this mandatory process will result in a penalty and many other consequences.

PAN-Aadhaar Linking Date Extended

So, the Government has again extended the PAN-Aadhaar linking date till June 30, 2023. If you want to avoid the penalties and your PAN becoming inoperative then you should complete this process within the deadline.

What Happens if Your PAN Becomes Inoperative?

If your PAN becomes inoperative it would be like that you haven’t received it in the first place. The Income Tax Department will lift all the benefits and facilities that come with PAN.

“Where a person, whose permanent account number has become inoperative…, is required to furnish, intimate or quote his permanent account number under the Act, it shall be deemed that he has not furnished, intimated or quoted the permanent account number, as the case may be, following the provisions of the Act, and he shall be liable for all the consequences under the Act for not furnishing, intimating or quoting the permanent account number,’ said CBDT.

As per, Section 272B of the Income Tax Act, PAN holders will be fined ₹10,000 penalties if their document is not furnished as required by the Income Tax Department.

Also read:
ITR Filing Last Date: How to File ITR, How to Verify ITR, How to Download ITR

PAN-Aadhaar Linking Penalty Fee

The current fine is ₹1,000 which the PAN will have to pay if their document is not linked with their Aadhaar before the deadline, June 30, 2023.

The income tax department has conveyed the following consequences if the PAN of a person becomes inoperative:

“Refund of any amount of tax or part thereof, due under the provisions of the Act shall not be made to him.”
“Interest shall not be payable to him on such refund for the period, beginning with the date specified under sub-rule (4) of rule 114AAA and ending with the date on which it becomes operative.”
“Where tax is deductible under Chapter XVJJ-B in case of such person, such tax shall be deducted at a higher rate, in accordance with the provisions of section 206AA.”
“Where tax is collectable at source under Chapter XVJJ-BB in case of such person, such tax shall be collected at a higher rate, in accordance with the provisions of section 206CC.”