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“If NRIs are holding Aadhaar along with PAN, it is mandatory for them to link it,” explained Dixit Jain, managing director at The Tax Experts DMCC, a Dubai-based tax advisory firm.
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“However, if they have missed the deadline of linking they can still link it by paying the penalty.”
UAE-based Indian expats who make regular financial transactions in India and also file taxes on any income generated in India must be aware of how important your Permanent Account Number (PAN) is, reported Gulf News.
However, that will no longer be the case since July 1. India’s tax authority wanted all tax payers to mandatorily link their PAN, an account number linking all tax-payer transactions, with Aadhaar, an identification number serving as a proof of identity and residence. The last date to link PAN with Aadhaar was June 30, 2023. Simply put, if a tax-paying Indian citizen had not linked both cards by that date, his or her PAN became ‘inoperative’ – making it very difficult to conduct various financial transactions in India. But does this impact Non Resident Indians (NRIs)?
When your PAN becomes ‘inoperative’, what it means is that you won’t be able to make use of tax or banking services where you have to compulsorily provide the unique account number. This include financial services like filing your income tax return (ITR) or accessing your bank accounts
“If NRIs are holding Aadhaar along with PAN, it is mandatory for them to link it,” explained Dixit Jain, managing director at The Tax Experts DMCC, a Dubai-based tax advisory firm. “However, if they have missed the deadline of linking they can still link it by paying the penalty.”
“NRIs who do not have an Aadhaar card are exempted to do so [link PAN with Aadhaar], however, they must update their residential status as a NRI on the Indian income tax portal. This is so that the relevant authority knows that they are under the exempted category.”
As an NRI, you do not require an Aadhaar card, but if you do have one, you were required to link PAN card with Aadhaar before July 1. But what should be your next steps when your PAN has become ‘inoperative’ after the deadline has lapsed and a new deadline hasn’t been given?
If you missed the deadline, there is still a way to access your PAN to link the two cards, but this comes with a penalty. “The PAN can be made operative again in 30 days, upon the payment of fee of Rs 1,000,” India’s tax authority, the Central Board of Direct Taxes (CBDT), recently clarified.
When your PAN becomes ‘inoperative’, what it means is that you won’t be able to make use of tax or banking services where you have to compulsorily provide the unique account number. This include financial services like filing your income tax return (ITR) or accessing your bank accounts.
HOW TO CHECK IF YOUR PAN IS VALID OR INVALID
Step 1: Go to e-Filing portal
Step 2: Click ‘Verify Your PAN’; on the page, enter PAN, DOB and mobile number
Step 3: Enter 6-digit OTP from the mobile number entered; click ‘Validate’
According to the Indian Income Tax website, here is how you can still go ahead and link your PAN with Aadhaar card –now with a penalty:
Step 1: Login https://www.incometax.gov.in/iec/foportal/, under the ‘Link Aadhar to PAN’ option
Step 2: Enter your PAN and Aadhar Number, and click on ‘Continue to Pay Through e-Pay Tax’
Step 3: Confirm PAN, mobile number to get OTP, after which you will be redirected to e-Pay Tax page
Step 4: Select ‘AY’ as 2024-25, type of ‘Payment’; Applicable amount will be pre-filled against ‘Others’
Step 5: Post payment of fee you can link your Aadhaar number with PAN on the e-filing portal
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