Pan-Aadhar Link: There are 6 days left for the end of the year and with this the deadline for completing a very important financial task is approaching. We are talking about linking your PAN card with Aadhaar card. If you haven’t linked these two documents yet, you need to be alert immediately. After the date of 31st December, you will not only suffer financial loss, but your PAN card will also become a useless piece of paper.
Government and Income Tax Department are continuously making people aware to complete this process. As per the rules, linking of PAN and Aadhaar is now mandatory. People who miss this deadline may face huge difficulties. Let’s understand how it will affect your pocket and your financial activities if you don’t do this.
PAN will be deactivated
The Income Tax Department has clarified that the deadline for linking PAN and Aadhaar is December 31, 2025. Any taxpayer who does not link his PAN with Aadhaar by this date will have to pay a penalty of Rs 1,000. This penalty will be charged as ‘Late Fee’ as the original linking deadline has already passed.
The biggest concern is that only Rs. 1000 fine, but the PAN card will become ‘inactive’. The notification issued by the Income Tax Department on April 3, 2025 clearly states that PAN cards which are not linked after the stipulated date will be treated as inactive in the system. This simply means that you will be deprived of all the facilities where the use of PAN card is mandatory. Also, those who have been allotted a new PAN after October 1, 2024, are required to complete the linking process by December 31.
Banking and investment avenues will remain closed
If your PAN card gets deactivated, it will have the worst impact on your banking services. With an inactive PAN you will not be able to open a new account in any bank. Not only this, if you invest in stock market, mutual fund or equity, that too will be stopped. PAN card is the most important document for financial transactions and without it your entire investment planning can go awry.
Apart from this, many restrictions will also be imposed in banking transactions. You cannot deposit more than Rs 50,000 cash in the bank at a time. Also, any bank transaction above Rs 10,000 may face problems. PAN is also mandatory for creation or renewal of debit or credit card, which will not be possible in case of inactive PAN.
Double whammy of tax refund and TDS
Deactivation of PAN card will affect tax payers the most. You will not be able to file your Income Tax Return (ITR). If any of your old refunds are pending with the Income Tax Department, they will also be stuck. The problem does not end here. When your PAN is not active, TDS and TCS are deducted at a higher rate than the normal rate. This will have a direct impact on your accumulated capital.
Also, you will not be able to use Form 26AS nor will you be able to obtain a TDS certificate. If in future you need to renew your PAN card or create a new one, the process can be very long and complicated. So, it is wise that today without waiting for 31st December, Rs. Link your PAN and Aadhaar by paying a late fee of 1000 and avoid future problems.