The linking of your Permanent Account Number (PAN) and Aadhaar number is mandatory under current regulations. According to the Central Board of Direct Taxes (CBDT), if the you fail to link the two, their PAN cards may become 'inoperative'. As a result, you will not be able to conduct financial transactions.

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While the deadline to link the two without any fine has ended, you can still do the same by paying a fine of Rs 1,000.

This can be done on the National Securities Depository Limited (NSDL) portal by paying the amount under Challan No. ITNS 280 with Major head 0021 (Income Tax Other than Companies) and Minor head 500 (Other Receipts).

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Here is a step-by-step process to pay PAN-Aadhaar linking late fees:

Step 1: Visit the official e-filing website of the Income Tax (I-T) Department to link the two. When it asks for payment, click on the link and you will be redirected to NSDL website.

Step 2: Under the options available, proceed under Challan No. ITNS 280 to submit PAN-Aadhaar link request

Step 3: Select the tax applicable from there. The payment should be done under Major head 0021 (Income Tax Other than Companies) and Minor head 500 (Other Receipts) in a single challan

Step 4: Select the preferred payment mode and enter details

Step 6: Enter PAN, address and assessment year

Step 7: Enter the Captcha and make payment

This payment may require some time to display at the income tax e-filing portal. So, if you want to link PAN with Aadhaar should wait a few days after making the payment.

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Once there is confirmation, you can login to the income tax portal, enter all details (name, date of birth, address, PAN and Aadhaar number) and proceed with the linking

Here are the services that may get impacted in case PAN is not linked with Aadhaar:

ITR returns will not be processed

Users should note that while income tax returns can be filed even without linking the two, the department does not process the returns until PAN and Aadhaar are linked.

Bank account savings will be impacted

This will also lead to an individual’s KYC being incomplete as a PAN card is one of the necessary documents required for the completion of KYC. This will, in turn, impact one's bank account savings.

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Additionally, if the individual earns interest on savings above Rs 10,000, then the tax deducted at source (TDS) rate levied will be 20 percent as TDS levied on a bank account without a PAN card is doubled.

First Published:Aug 16, 2022 1:11 PM IST