Here’s what will happen if you fail to link Aadhaar-PAN by June 30
The central government had extended the deadline for linking Aadhaar to Permanent Account Number (PAN) considering the pandemic situation in the country. The last date to link your Aadhaar to your PAN is June 30, 2021. The deadline was extended from March 31 to June 30.
What is PAN?
A PAN is a ten-digit unique alphanumeric number issued by the Income Tax Department. People carry it in the form of a laminated plastic card.
What happens if you don’t link PAN with Aadhaar?
The Central Board of Direct Taxes (CBDT) in a notification has said, if anyone fails to link PAN card to Aadhaar card, it will become inoperative. It also clarified that in case users link their PAN with Aadhaar Card after the deadline passes, then the PAN card will “become operative from the date of intimation of Aadhaar number.”
In Budget 2021, the central government had also introduced a new section of 234H in the Income Tax Act, 1961.
Under this section, it was clear that if a PAN is NOT linked with Aadhaar after the deadline date, then a fine can be levied.
As per the new section, if the PAN is linked with Aadhaar on or after July 1, 2021, then the person will be liable to pay a penalty that cannot exceed Rs 1,000.
Where does one require PAN?
There are some situations where it is mandatory for a person to carry his/her PAN card. In this case, if the PAN becomes inoperative, a person may face issues in some transactions.
1. Sale or purchase of a moto vehicle or any vehicle that is not two-wheeled.
2. Opening up an account with a banking company or a cooperative bank.
3. For applying for a credit or debit card.
4. Opening a Demat account with a depository, participant, custodian of securities, or any other person with SEBI.
5. Payment in cash of amount more than Rs 50,000 to a hotel or a restaurant.
6. Payment in cash of an amount exceeding Rs 50,000 in connection with travel to any foreign country.
7. Payment of an amount more than Rs 50,000 to a company or an institution for acquiring debentures or bonds.
8. Payment of an amount more than Rs 50,000 to the Reserve Bank of India for acquiring bonds issued by it.
9. Payment in cash for an amount more than Rs 50,000 during any one day for the purchase of bank drafts, pay orders, or banker’s cheques from a banking company or a co-operative bank, among others.
If your PAN card becomes inoperative, you will not be able to conduct financial transactions wherever quoting it is mandatory.