Deadline looms to link India’s digital identity and tax accounts
Just days ahead of the June 30th deadline for individuals and businesses to link their PAN with Aadhaar digital identities, India’s Income Tax Department released a statement on Twitter outlining how demographic mismatches can cause linking failures. The PAN system will be inoperative as of July 1st, 2023, and those who fail to link their accounts to the Aadhaar system by this date will face serious tax consequences.
In March 2022, the Income-Tax Act made it mandatory for every person who was allotted a PAN as of July 1st, 2017 to link their Aadhaar number on or before June 30, 2023, according to India Express. Investors must also link PAN with Aadhaar for KYC purposes. Those who are eighty years of age or above, non-residents, and non-citizens are not required to link the accounts.
According to the Twitter statement, the attempt to link Aadhaar with PAN can fail due to mismatches in the identity-holder’s name, date of birth, or gender, the statement explains. Individuals would need to correct mismatched information within the Aadhaar and PAN systems in order to successfully link the accounts. If it still fails after this point, the statement says that individuals can pursue biometric authentication at a PAN Service Provider center.
Non-compliance by the deadline means that individuals cannot use their newly inoperative PAN to file their income tax return. Pending returns will also not be processed, and pending refunds cannot be issued to deactivated PANs. It could also make it more difficult for individuals to do financial transactions with banks because PAN is used for KYC compliance.
Those who fail to link their accounts by the deadline will have to pay a late fee of 1,000 Indian rupees (roughly US$12.18).
Article Topics
Aadhaar | digital ID | financial services | identity management | India | KYC
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