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PAN Aadhaar Link: PAN card holders are advised to link their Permanent Account Number (PAN) with their Aadhaar card number by 31 March 2021. Failure to meet this Aadhaar PAN link deadline will now result in late charges 1,000. According to the recently added Section 234H of the Income Tax Act, if a PAN card holder fails to seed one’s PAN with the Aadhaar card number on or before the given deadline, they are liable to pay 1,000 late fee. The section was added in the 2021 budget session through the Finance Bill.

According to the newly inserted section 234H of the Income Tax Act, “Without prejudice to the provisions of this Act, a person shall be required to inform his Aadhaar number under sub-section (2) of section 139AA and if such person fails to do so on or before such date as may be prescribed, after he has said shall be liable to pay such fee as may be prescribed at the time of notification under sub-section (2), not exceeding one thousand rupees.”

Except 1,000 fee for PAN Aadhaar linking, there are several other financial losses that PAN card holders cannot avoid. Failure to meet the deadline for Aadhaar PAN linking will invalidate one’s PAN card which means one will not be able to invest in mutual funds, shares, open a bank account etc.

Under Section 272B of the Income Tax Act, if a person furnishes an invalid PAN card, the Assessing Officer may direct such person to pay the amount, by way of penalty. 10,000. Also, invalid PAN card holders will not be able to file Income Tax Return (ITR).

Therefore, it is important for the PAN card holder to seed the PAN with its Aadhaar card number and avoid any penalty after failing to meet the PAN Aadhaar linking deadline.

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