New Delhi: The deadline for linking Permanent Account Number (PAN) with Aadhaar is December 31, and failure to complete the process may result in the PAN becoming inactive after this date, the Income Tax Department has warned.
Taxpayers who have not yet linked their PAN with Aadhaar have been urged to act immediately to prevent financial and compliance-related complications.
As per a notification issued by the Income Tax Department on April 3, 2025, individuals who were allotted a PAN on or after October 1, 2024, must link their PAN with Aadhaar by December 31, 2025. For all other PAN holders, the original deadline for PAN–Aadhaar linking was May 31, 2024.
If the linking is completed on or before December 31, a penalty of ₹1,000 will be levied, as the initial deadline has already expired. However, failure to link PAN with Aadhaar even after this date could lead to the PAN being deactivated.
An inactive PAN can create multiple challenges for taxpayers. Filing income tax returns may become impossible, and pending income tax refunds could remain stuck. In some cases, individuals may be required to undergo a lengthy process, including applying for a new PAN, to regularise their status.
Non-linking of PAN with Aadhaar may also result in higher rates of Tax Deducted at Source (TDS) and Tax Collected at Source (TCS). Access to Form 26AS could be restricted, and taxpayers may not receive TDS or TCS certificates.
Banking and financial transactions are also likely to be affected. Individuals with an inactive PAN may face restrictions on opening bank accounts, obtaining credit or debit cards, depositing cash above ₹50,000, or conducting bank transactions exceeding ₹10,000. Know Your Customer (KYC) procedures may remain incomplete, leading to denial of various government and financial services.
Additionally, investments in mutual funds and equity markets could be blocked, further increasing financial inconvenience.
In view of the wide-ranging consequences, taxpayers are strongly advised to link their PAN with Aadhaar well before the December 31 deadline to avoid disruption.
With inputs from IANS