The PAN-Aadhaar linking deadline has been extended due to the second wave of the novel coronavirus pandemic. The government has already extended the deadline thrice due to Covid-19 – first from March 31, 2020, to June 30, 2020, then to March 31, 2021, and then again to June 30, 2021. This extension will come as a relief for those who still have not linked their PAN with Aadhaar due to mismatch in details.
Relief to Income Tax Payer✅Time to invest in residential house for tax deduction extension for more than 3 months… https://t.co/lAVqs3lM2o
— Anurag Thakur (@ianuragthakur) 1624624496000
Do keep in mind that if your PAN is not linked with Aadhaar by the new deadline, then not only will your PAN become inoperative, but you will also be liable to pay a penalty of up to Rs 1,000 if the linking is done after the expiry of the deadline.
Penalty will be levied as per the newly inserted section 234H into the Income-tax Act, 1961. The insertion of the new law was done by the government at the time of passing of the Finance Bill, 2021. Though the law says that the maximum penalty amount will not exceed Rs 1000, however, the government is yet to prescribe the exact amount.
Further, once the PAN becomes inoperative, then an individual will not be able to conduct financial transactions wherever quoting of PAN is mandatory. If PAN is linked with Aadhaar after it has become inoperative then your PAN will become operative once again from the date of linking.
There are many financial transactions wherever quoting of PAN is mandatory. This includes at the time of filing income tax return, opening of a bank account, fixed deposit account etc.
Earlier, the law stated that if the PAN is not linked with Aadhaar, then PAN would become ‘invalid’, as if an individual never held the PAN. However, the rule regarding the consequences of not linking PAN with Aadhaar was revised in July 2019 Budget. The amendment in the law was done to protect the financial transactions undertaken prior to linking of the same.
How to link PAN with Aadhaar
There are three ways to link PAN with Aadhaar. These include: either by sending an SMS to 567678 or 56161, through the e-filing website, or manually by filling a specified form at a designated PAN service centre. If you are already filing ITR (income tax return), it is likely that your PAN is linked to Aadhaar.
