December 31 is the last day to link your Pan and Aadhaar. What happens if you miss the deadline

It’s the final countdown. Before you get ready to ring in the New Year, you need to do one final check. Is your Permanent Account Number (PAN) with your Aadhaar? Today (December 31) is the deadline to link two cards. If you fail to comply, your Pan will be inoperative from January 1, 2026. This will affect financial and tax-related transactions, including opening new bank accounts.      

The income tax department has repeatedly reminded Pan holders to follow the process. It had set the Pan-Aadhaar linkage deadline at June 30, 2023, extending it later to May 31, 2024, with a late-linking penalty of Rs 1,000.

Taxpayers who attempt to link their Pan to Aadhaar now must pay a Rs 1,000 penalty, if applicable, on the income tax portal before submitting the linking request. However, a subset of Pan holders who received their cards on or after 1 October 2024, using their Aadhaar enrolment ID, will be exempt from this fee,  Mint reported.  

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But what happens if you fail to complete this crucial compliance requirement?   

What if Pan-Aadhaar are not linked by December 31   

If a taxpayer fails to pay the applicable penalty and not meet the December 31 deadline, then the Pan card becomes “inoperative”, the income tax department warned. Once this happens, it cannot be used for financial and tax-related activities. Opening bank accounts, filing income tax returns or receiving tax refunds will be hindered. High-volume purchases, cash deposits, and certain banking services will also be hit.

Bank transactions exceeding Rs 10,000 will also not be permitted. There will be difficulty in applying for a debit or credit card, depositing cash at a bank or post office, or purchasing a bank draft or pay order in cash.   

Hurdles extend beyond day-to-day transactions: Pan and Aadhaar are required for passport applications and bank account openings. If these two cards are not linked, access to these services will be difficult.   

Obtaining a new Pan card may be difficult if the old card is damaged or lost, as the Aadhaar number is required when applying for a replacement, a media report earlier noted. TCS/TDS credit will not appear in Form 26AS, and TCS/TDS certificates will not be accessible.    

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What should you do if the Pan becomes inoperable? 

If the deadline is missed and the Pan is rendered inactive, it can still be reactivated. However, even after the deadline, a penalty of Rs 1000 will continue to apply. Within 30 days of completing the required process, including submission of Aadhaar details and payment, the Pan card can be restored.  

How to link Pan and Aadhaar  

Here are the steps to complete Pan-Aadhaar linking. 

-Log in to the income tax e-filing portal (https://eportal.incometax.gov.in/iec/foservices)
-Move to the profile section and choose the option to link your Pan with Aadhaar
-Fill in your Pan and Aadhaar details. Once done, select the payment through the e-pay tax option to proceed.
-Click on the relevant assessment year and select ‘other receipts’ in your payment category
-Then you would need to verify the pre-filled payable amount
-Once done, click on continue
-A challan will be generated. Make the payment through your bank’s portal.
-After the payment is successful, you have to return to the e-filing portal to finalise the linking process
-Mention your Pan, Aadhaar and then click on ‘validate’
-You will receive an OTP, enter the OTP to proceed and submit the request to finish the linking process 

How to verify that your Pan is linked to Aadhaar 

To check if the two cards are linked, visit the income tax e-filing portal and click the status check option. Enter your Pan and Aadhaar card numbers to avoid “retry”. Finally, submit the information to see the final verification status.   

With inputs from agencies