Many important rules related to PAN (Permanent Account Number) and Aadhaar have been made in the New Income Tax Bill 2025, compliance of which will be mandatory for taxpayers. These rules have been implemented with the aim of making tax administration more transparent and digital.
Linking of PAN and Aadhaar is mandatory
Under the new Income Tax Law, every person who has been allotted a PAN and who is eligible to obtain an Aadhaar number will have to intimate his Aadhaar number to the Income Tax Department.
- If a person does not do so, his PAN will become inactive.
- Inactive PAN cannot be used for activities like banking, financial transactions and tax filing.
Facility to use Aadhaar as an alternative to PAN
- Individuals who do not have PAN can use their Aadhaar number.
- Such persons will later be allotted a Permanent Account Number (PAN).
- Individuals who are already PAN holders can also use their Aadhaar in place of PAN, provided they have already intimated their Aadhaar number.
It is illegal to have more than one PAN
- Any person who already holds a PAN cannot obtain a second PAN.
- If a person holds two or more PAN cards, he may face heavy penalties or legal action.
Mandatory use of PAN or Aadhaar for financial transactions
- Any person has to furnish PAN or Aadhaar number while transacting with the Income Tax Department.
- PAN or Aadhaar will be required for opening bank accounts, depositing cash above Rs 50,000, purchasing real estate and other major financial activities.
- The concerned authority will have to ensure that the PAN or Aadhaar is authenticated correctly.
Financial penalty for not linking Aadhaar-PAN
If a person does not link PAN with Aadhaar within the stipulated time limit, he may have to pay a fine of up to Rs 1,000. Also, such PAN can be deactivated, which may cause problems to the taxpayer in financial activities.
Heavy penalty for giving wrong information
If a person furnishes a wrong Aadhaar or PAN number, a fine of Rs 10,000 can be imposed per violation. Apart from this, more stringent legal action can also be taken in case of tax evasion or fraud.
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