All about PAN-AADHAR linking: Post 31st March 2022

Every Indian citizen receives an Aadhaar card, which is a centralized and universal identifying number. The Aadhar Card is a biometric record that maintains an individual’s information in a government database and is increasingly replacing paper as the government’s primary source of data for public welfare and citizen services. Furthermore, Finance Minister Nirmala Sitaraman has suggested in Budget 2020 a new feature that allows users to receive a rapid Permanent Account Number (PAN) using their Aadhaar without completing a lengthy application form. In this article, we will cover the PAN Aadhar Link and how to link a PAN to an Aadhar Card. Permanently link your PAN Number (PAN) with Aadhaar, if not, then there is a fine, and your PAN may not work. This article will discuss PAN-AADHAR linking.

PAN Card and Aadhar Card Overview

PAN (Permanent Account Number) is a number that is used to identify various taxpayers in the country. A PAN Card is a 10-digit unique identifying alphanumeric number (which includes both alphabets and numbers) issued to Indians, mostly those who pay taxes. The PAN identification system is a computer-based system that assigns each Indian taxpaying organization a unique identification number. All of a person’s tax-related information is recorded against a single PAN number, which acts as the primary key for data storage. Because this information is disseminated across the country, no two people in tax-paying organizations can have the same PAN.
In contrast, the Unique Identification Authority of India (UIDAI), a national government organization, proposed in early 2010 to assign unique numbers to each citizen in the country after collecting and storing their biometric information. The Aadhaar number is a one-of-a-kind 12-digit number.
The Aadhaar card stores the 12-digit number, as well as the cardholder’s fingerprint and other credentials. The UIDAI hoped to connect the Aadhaar number to banks, government subsidies, and even mobile phone services. Aadhaar has evolved to become the largest single identifying initiative in the world. A person can only have one Aadhaar number, according to the laws.

PAN-AADHAR linking clause

CBDT has introduced Income Tax Laws (Third Amendment), 2022. CBDT incorporates sub-rule (5A) into Rule 114. Sub-rule (5A) provides that if a person informs people of his Aadhaar number after the due date between 01-04-2022 and 30-06-2022, he will be liable to pay a fee of Rs. 500; and Rs. 1,000, in all other cases. And if the PAN is not connected to Aadhaar by March 31, 2023, the following year beginning April 1, 2023, your PAN will be inactive. If your PAN no longer works, you will not be able to file a tax return, open a bank account, invest in mutual funds, etc. The new sub-rule (5A) in Rule 114 provides that if a person links his Aadhaar number to the PAN Card thereafter on the due date, then you will be liable for payment: 

•  Rs. 500- between 01-04-2022 and 30-06-2022; and 
• Rs. 1,000- in all other cases. Such fees will be paid by the person at the time the Aadhaar number is specified.

In addition, subsection (2) of Rule 114AAA states that where a person is required to provide, close to, or quote his or her PAN, and his or her PAN is no longer valid, it will be deemed that he/she has not provided or intimated the PAN. As a result, you will be liable for all consequences of furnishing, intimating, or quoting PAN.

The procedure of PAN-AADHAR linking 

Recently the Income Tax Department enabled PAN-Aadhaar to link to the tax portal. But to connect PAN with Aadhaar, you must first pay the prescribed fee. There are two major steps:

• Step: 1: Payment of applicable cash in the NSDL portfolio (now Protean) under Major Head (0021) and sub-head (500) of AY 2023-24.
  Payment of Rs. 500 or Rs1000 should be in one challan and the assessment year should be 2023-2024.

• Step: 2: Submit an Aadhaar link request to the e-Filing portal after 4-5 working days of payment via NSDL (now Protean) website.
  Continue to the income tax portal after 4-5 working days. Log in on the income tax filing portal. On the profile page, you can find the PAN-Aadhaar link option. After clicking the option you must enter the PAN number and Aadhaar number. After entering the number, the portal will ask for confirmation of payment. When confirming payment you must state the name as per Aadhaar. When a name is entered, you will be asked to verify OTP. To successfully connect your phone number you must register with Aadhaar. In successful OTP production, the linking process will be completed.

Note: A specific payment gateway at a private bank is not amended from the above payment. So there will be an error message on payment. We should check the banks empowered to complete the payment.

What happens if PAN-Aadhaar is not connected?

According to a CBTD media report, “To reduce the inconvenience to taxpayers, under notice No.17/2022 dated 29 March 2022, taxpayers have until March 31, 2023, to notify the designated authorities of the Aadhaar-PAN connection without filing. As a result, taxpayers will be charged for the first three months, an amount of Rs. 500, and after April 1, 2022, Rs. 1000.
As a result, your PAN will be operational by 31 March 2023, and PAN-Aadhaar can be connected for a fee.
It is noteworthy that the tax authorities may review a fine of up to Rs 10,000 for not having a current PAN under section 272B.

How can I see that Pan is linked to my Aadhaar number?

Follow the procedures below to see if your PAN is already linked to your Aadhaar number.

• Visit the incometax.gov.in portal and fill out the form.
• In the Quick Links section, select Aadhaar Link Status.
• Enter your Pan and Aadhaar number.
• Select View Aadhaar Status Link from the drop-down menu.
• A pop-up will show confirming whether your PAN is connected to your Aadhaar number or not.

Final words

People who do not get their PAN cards linked to their Aadhaar cards will be fined and their PAN may not work. A penalty will be levied in terms of section 234H of the Income Tax Act, 1961. The amount of the fine has not been announced but will not exceed Rs 1,000 if you get it linked after the due date.

Consult with our Experts for acquiring your PAN Card and Aadhar Card. Legal Window will assist you with the filing procedure.