The linkage of the Permanent Account Number (PAN) with the Aadhaar card has been made mandatory by the Income Tax (IT) Department of India. Failure to comply leads to severe consequences including inoperative PAN status and higher tax deduction rates. Let’s dive deep into the latest rules, deadlines, penalties, and the process to reactivate your PAN card in 2025.
Latest Update on PAN-Aadhaar Linking
The last official deadline to link Aadhaar with PAN was 30th June 2023. If you missed this deadline, your PAN became inoperative from 1st July 2023. However, a grace period was offered. If linking is not completed by 31st May 2024, higher TDS/TCS rates will apply as per Sections 206AA and 206CC of the Income Tax Act, 1961.
You can still link your PAN with Aadhaar even after missing the deadline, by paying a penalty of INR 1,000. Once done, the PAN will become operative within 7-30 days.
Circular Highlights: PAN-Aadhaar Linking
- Section 139AA: Makes it mandatory to link PAN with Aadhaar for all PAN holders, except exempt categories.
- Initial deadlines extended multiple times, finally up to 30th June 2023.
- Penalty for delayed linking:
- Between 1st July 2022 – 30th June 2023: Rs. 1,000
Who is Exempt from PAN-Aadhaar Linking?
- Individuals in Jammu & Kashmir, Assam, and Meghalaya
- Non-residents as per Income Tax Act
- Super senior citizens (80+ years)
- Foreign citizens
Importance of Linking PAN with Aadhaar
- PAN becomes inoperative if not linked
- Cannot file ITR or claim refunds
- Cannot access essential services (banking, passport, mutual funds)
- Loss of TDS credit in Form 26AS
- Difficulty in applying for a new PAN
Consequences of Not Linking PAN with Aadhaar
- ITR cannot be filed
- TDS/TCS deducted at higher rate
- No TDS/TCS credits in Form 26AS
- Cannot submit Form 15G/15H
- Transactions like opening a bank account, buying mutual funds, fixed deposits, and large cash transactions will be disallowed
- Limited access to government subsidies
How to Pay Penalty for Non-Linking PAN-Aadhaar
- Visit Income Tax e-Filing Portal
- Go to Quick Links > e-Pay Tax
- Enter PAN, mobile number, validate OTP
- Select Income Tax > AY 2024-25 > Minor Head: Other Receipts (500)
- Choose “Fee for delay in linking PAN with Aadhaar”
- Make a payment of INR 1,000 via net banking, UPI, or authorised banks
How to Link PAN with Aadhaar After Deadline
- Wait 4–5 days after payment
- Visit e-Filing Portal > Link Aadhaar option
- Enter PAN and Aadhaar details
- Validate payment and proceed
- Submit linking request using OTP
- PAN will be reactivated within 7–30 days
Supported Banks for Payment Gateway
- SBI, HDFC, ICICI, Axis, PNB, Bank of Baroda, Union Bank, and more
Why You Must Act Now
Delays can cost you more than Rs.1,000. They may cost you your financial credibility, access to banking services, or even your TDS refund. Link now, stay compliant, and avoid financial hassle.
Frequently Asked Questions (FAQs)
What is the last date to link PAN with Aadhaar?
The final deadline was 30th June 2023, but a grace period extends until 31st May 2024, with a penalty of INR 1,000.
Can I still link PAN and Aadhaar after the deadline?
Yes, you can still link it by paying the penalty of Rs.1,000.
What happens if I don’t link my PAN with Aadhaar?
Your PAN becomes inoperative, and you will face higher TDS, blocked financial services, and rejection of your ITR.
How do I pay the penalty for delayed PAN-Aadhaar linking?
Use the e-Filing portal’s ‘e-Pay Tax’ service, select the appropriate heads, and pay Rs.1,000 via your bank.
How long does it take for the PAN to become operative again?
It usually takes 7 to 30 days after successful linking and payment.
Are there any exemptions from linking?
Yes, residents of Assam, Meghalaya, Jammu & Kashmir, super senior citizens, and non-residents are exempt.
Can I file ITR with an inoperative PAN?
No, filing ITR or claiming refunds is not possible with an inoperative PAN.
Will TDS credit reflect if PAN is not linked?
No, you will lose TDS credit and the tax will be deducted at a higher rate.
Can linking be done offline?
Yes, you can visit a PAN centre and submit the required documents manually.
Click here to know more.
Aanchal is a passionate writer with a keen interest in storytelling, content creation, and creative expression. She enjoys exploring diverse topics and crafting engaging narratives that captivate readers.