In a recent advisory, the Income Tax Department stated that Personal Account Numbers (PANs) that are not linked to Aadhaar by March 31, 2023, will become invalid as of April 1. A PAN not operative might be quite damaging to your financial situation. Most financial transactions use the ten-digit, unique alphanumeric number issued by the Income Tax Department.
"According to the Income Tax Act of 1961, everyone who has a PAN and is not exempt must link their PAN to their Aadhaar by 31.3.2023. The unlinked PAN will stop working on 1.04.2023. What is mandatory, is necessary. Don’t delay, link it today!” The Income Tax agency urged people to link it immediately in a tweet.
States Exempt from PAN Aadhar linking
According to a notification released by the Union Finance Ministry in May 2017, the "exempt category" consists of people who live in the states of Assam, Jammu and Kashmir, and Meghalaya; who are considered non-residents under the Income-tax Act, 1961; who were 80 years of age or older at any point in the previous year; and who are not Indian citizens.
According to a circular published by the Central Board of Direct Taxes (CBDT) on March 30, if a PAN fails to be operational, a person would be held accountable for all IT Act ramifications and face a number of consequences.
What happens if PAN becomes inoperative?
PAN card is used in numerous transactions such as:
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Sale or purchase of a motor vehicle or a vehicle other than two-wheeled vehicles
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Creating an account with a cooperative bank or a banking organization
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Filling out an application to get a debit or credit card
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Creating a Demat account with SEBI with a depository, participant, securities custodian, or any other person
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Payment of a bill for more than Rs 50,000 in cash to a hotel or restaurant at one time
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Payment in cash of more than Rs 50,000 for international travel or payment for the purchase of any amount of foreign currency at once
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Payment to a mutual fund of more than Rs 50,000 for the purchase of its units
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Paying a company or organization more than Rs 50,000 to purchase bonds or debentures they have issued
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Cash deposits made with a cooperative bank or a banking company that surpass Rs 50,000 in a single day
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Cash deposits totaling more than Rs 2,50,000 made between 9 November 2016 and 30 December 2016 in a bank, cooperative bank, or post office
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Payment in cash for any purchase of bank drafts, pay orders, or banker's checks from a banking company or a cooperative bank that exceeds Rs. 50,000 in a single day
