Up to Rs 1,000 will be charged if PAN-Aadhaar is not linked by March 31, but PAN will remain active

Late fine from 1st April 500 will be levied if PAN is linked with Aadhaar within first three months and thereafter 1000 will be charged. However, the CBDT has restricted the penalty to late fee only and clarified that PAN will continue to be in force and all transactions quoting PAN will not be affected.

“In order to reduce the inconvenience to the taxpayers, vide Notification No. 17/2022 dated March 29, 2022, an opportunity has been provided to the taxpayers to inform their Aadhaar to the prescribed authority by March 31, 2023. CBDT said in its circular, linking of Aadhaar-PAN without any result.

Earlier, it was announced that the defaulters will not only have to pay late penalty but the existing PAN number will also become inoperative.

Amit Maheshwari, Tax Partner, AKM Global, said, “Deactivation of PAN implies that an individual does not have any PAN for income tax purposes. This may create problems for some NRIs (Non-Resident Indians). Because they don’t have a base.”

Also, inoperative PAN prevents people from doing certain transactions where it is mandatory to mention it, such as purchase of immovable property, payment of excess 50,000 for life insurance premium or purchase of mutual fund units, sale or purchase of motor vehicles, etc.

“Once the PAN is deactivated, the person will be barred from carrying out financial transactions, TDS at higher rates and penalty under section 272B,” said Neeraj Aggarwal, partner, Nangia Andersen. An Assessing Officer (AO) issues a penalty under section 272B when he finds that the taxpayer has failed to submit or comply with any of the mandatory requirements relating to PAN specified in the Income Tax laws for a transaction. fine which may be 10,000 for each default.

However, taxpayers need not worry about it yet as this penalty will not be applicable till April 2023. “…PAN of assessees who have not intimated their Aadhaar till March 31, 2023, will continue to function for the processes under the Act, such as furnishing of return of income, processing of refunds etc.,” the CBDT said. .

Taxpayers can link their PAN and Aadhaar and also check the linking status

income tax website https://incometaxindiaefiling.gov.in/, Alternatively, the linking process can also be done through SMS by sending a message in UIDPAN format <इन्सर्ट आधार> <पैन दर्ज करें> From your registered mobile number to 56161 or 567678.