What Happens If PAN Becomes Inoperative?
Naveen Wadhwa, DGM, Taxmann.com, said, “An individual who has missed the last date to link PAN with Aadhaar can link it after the expiry of the deadline also. However, the PAN will become operative again within 30 days from the date of intimation of Aadhaar. For instance, if an individual requests for linking of his PAN with Aadhaar on July 20 (after paying the penalty), the PAN will become operative on or before August 19. Do note that till the period PAN remains inoperative, the consequences of not having PAN will apply. Some of these are higher TDS on incomes, no income tax refunds, etc.”
If you fail to link your PAN (Permanent Account Number) with Aadhaar within the given deadline, the following consequences may apply:
- Inability to use PAN for certain financial transactions: You won’t be able to use your PAN for certain financial tasks, which may include opening a bank account, conducting high-value transactions, filing income tax returns, and more.
- Higher tax deduction: If your PAN is not linked with Aadhaar, tax deductions at a higher rate, as prescribed by the income tax department, may be applicable on various transactions, such as salary, rent, or any other payments where tax deduction is required.
- Non-processing of pending returns: Any pending income tax returns that require PAN and Aadhaar linkage may not be processed until the linkage is completed. This could lead to delays in tax processing and potential penalties for late filing.
- Non-issuance of pending refunds: If you have any pending income tax refunds, they may not be issued until the PAN and Aadhaar linkage is completed. This could result in delayed refunds.
- Inability to complete pending proceedings: If you have any pending proceedings with the income tax department, such as rectification of a defective return, those proceedings may not be completed until the PAN and Aadhaar linkage is done.
It is important to note that the specific consequences may vary depending on the policies and regulations of the income tax department in your jurisdiction. It is advisable to comply with the PAN and Aadhaar linkage requirements within the given deadline to avoid any potential issues.