As per recent Income Tax regulations, the absence of a link between PAN (Permanent Account Number) and Aadhaar can lead to significant implications for individuals.
A PAN that remains unlinked with Aadhaar is deemed “inoperative,” rendering it equivalent to not having a PAN at all.
This raises pertinent questions about the effect on banking activities, salary disbursement, and other financial transactions.
Inoperative PAN and Its Ramifications
Individuals with an inoperative PAN face restrictions in various financial aspects. Activities such as opening a new bank account or making investments like fixed deposits become challenging without a valid PAN.
The repercussions are akin to not possessing a PAN altogether.
The looming question for many is whether this status impacts the receipt of salary, as well as the use of debit and credit cards.
Salary Crediting and Inoperative PAN
Experts assert that while an inoperative PAN due to the lack of Aadhaar linkage hampers PAN-related transactions, it doesn’t impede the crediting of salaries. Employers can continue to disburse salaries to bank accounts associated with inoperative PANs.
The bank is legally bound to process salary credits, regardless of the PAN’s status. However, some speculate that delays might occur in the case of PAN-Aadhaar non-linkage.
Services at Risk Due to Inoperative PAN
Deactivated PANs pose challenges when attempting to access certain services that require mandatory PAN quoting. To regain access to these services, linking the PAN with Aadhaar becomes a necessity. This underscores the importance of resolving the PAN-Aadhaar linkage at the earliest convenience.
Reactivating an Inoperative PAN
Individuals facing an inoperative PAN status have the opportunity to reactivate it. By linking PAN with Aadhaar and paying a penalty of Rs 1,000, individuals can restore their PAN’s functionality.
The reactivation process entails paying the stipulated fine, resulting in the restoration of the PAN within 30 days.
As the deadline for PAN-Aadhaar linkage looms, individuals are urged to take the necessary steps to ensure seamless financial transactions and access to essential services.