Business News: The Modi government had set, June 30, 2023, as the last date to link the Permanent Account Number (PAN) with Aadhaar. Those individuals whose PAN was not linked with Aadhaar by the said date then their PAN was classified as ‘inoperative’. As per the income tax rules, an inoperative PAN is the same as an individual not having a PAN. Hence, an individual will not be able to quote PAN, wherever it is mandatory such as for the opening of a bank account, investing in bank FDs etc.
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It is important to note that the primary function of PAN is to provide a universal identification to an individual’s financial transactions. The card also helps the Income Tax Department to monitor the same when needed.
On the other hand, the Aadhaar number, which is issued to every Indian by the Unique Identification Authority of India (UIDAI), acts as an identity proof for all. If your PAN card has become inactive or inoperative, you may be wondering how this will affect your banking transactions. For example, will your salary still be credited to your bank account? Will you be able to apply for or use debit or credit cards?
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Will an individual’s salary be credited to their bank account if PAN is inoperative?
Anil Rao, Head – Consumer Operations & Solution Delivery, IndusInd Bank talking to The Economic Times said, “If PAN is not linked to Aadhaar, such PAN will be treated as inoperative (i.e., the person will not be able to furnish, intimate or quote his PAN). However, the salary shall continue to be credited in the bank account even in case of inoperative PAN.”
There could be a delay in receiving the salary in some cases as employers usually require a valid PAN to process the salary. In such a case, employees need to inform their employers beforehand to find a solution to the issue to avoid any complications.
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How to reactivate PAN?
If your PAN card has become inoperative or inactive then you can reactivate it by paying a late fine of Rs 1,000. As per the Central Board of Direct Taxes (CBDT), individuals need to inform the designated authority about their issue and pay a fee of Rs 1,000.
One can also visit the official website and submit a ‘PAN-Aadhaar’ linking request. The PAN reactivating process is expected to take 30 days from the date of linking.
