What is a PAN Card?
PAN refers to Permanent Account Number. A PAN (Permanent Account Number) card comprises of a 10 character unique code. The Income Tax Department allots it to each taxpayer. The card serves as a universal identification key, making it convenient for the government to keep track on an individual or entity’s transactions. A PAN card is essential for filing Income Tax returns in the country, all individuals and entities that pay tax are required to have one. A PAN is also used for proof of identity and age.
What is an Aadhar Card?
The Aadhaar card is a unique identification card, issued by the Unique Identification Authority of India that is allotted to every Indian citizen. The card has a 12 digit unique number that serves as a proof of identity as well as a proof of address. The card serves as a personal identification; it contains an individual’s biometric and demographic information. Recently government has made the Aadhar card a mandatory document for every Indian citizen. One requires it as a proof of identity for availing benefits government run schemes.
Linking Aadhar and PAN Mandatory
Under the amendments of the Finance Act 2017, Indian government has made it mandatory for taxpayers to quote the Aadhaar for filing of income tax returns. From July 1 onwards, to apply for a new PAN one has to produce Aadhar Card as an essential document. PAN that is not linked to Aadhaar Card numbers will be considered invalid after July 1, 2017. It is best to link PAN with your Aadhar beforehand.
Need for linking
Since long, it has been government’s one of the biggest concerns that some tax invaders have fraudulently created more than one PAN cards in order to save taxes on more than one source of income.
Aadhar is a biometric verified identification, which makes it impossible for any person to have multiple Aadhaar numbers. By linking Aadhaar to PAN numbers, one person can have only a single PAN Card.
How to link Aadhar card to your PAN Card:
The Income Tax department created a new link (“Link Aadhaar”) on its website for users, to directly link their Aadhar Cards with their PAN Cards.
- Log on to income tax website and click on the left panel “Link Aadhaar”
- Provide PAN card details, Aadhaar number and enter name exactly as given in Aadhaar card, and submit.
- After verification from UIDAI (website for Aadhaar), your linking will be confirmed and notified to you.
Linking can be done after login, follow the steps:
- Register yourself at the income tax e filing portal
- Login using your username, password and date of birth, if you are already registered on the website.
- After successful login in a pop up window will appear prompting you to link your PAN card with your Aadhaar card, click on the link.
- Your details such as name, gender, DOB will be mentioned on the portal. Before linking you can verify all the details with that in your Aadhar card
- If your details match, enter your Aadhar number and Captcha code Click on the tab “Link Now”.
- A pop up window will notify you with a message that your Aadhar card is now linked with your PAN Card
Linking by sending an SMS
The income tax department recently advertised about linking Aadhar with PAN Card by simply sending an SMS. However, this facility can only be availed by people whose names are identical on both Aadhar and PAN. Those who have a minor mismatch can visit the Income Tax Department website to link their Aadhar with PAN.
Step to link your Aadhar with your PAN Card through SMS
Simply send an SMS to 567678 or 56161 in the following format:
UIDPAN<SPACE><12 digit Aadhaar><Space><10 digit PAN>
UIDPAN 111133333322 AAAAABBBBB
Benefits of linking Aadhar with PAN:
PAN card and Aadhaar card are both extremely important identity proofs that are essential for financial and other transactions, registrations, etc. Following are some benefits you can consider while linking Aadhar Card with PAN Card:
Prevention of Tax Evasion
As stated earlier, Aadhar Card is a biometric verified identification thus it is impossible for any person to have multiple Aadhaar numbers. By linking the Aadhaar and PAN cards, the government will be able to keep track on the taxable transactions of a particular individual or entity which means every taxable transaction or activity will be recorded by the government.
Since the government will already have a detailed record of all the financial transactions and the tax that would be levied for on such transactions, tax evasion would be next to impossible.
A stop on fake PAN Cards
By applying for more than one PAN card, an entity can use one PAN to carry certain transactions and pay taxes while using other PAN Card to carry out other set of financial transaction and hiding the same from Income Tax Department.
By linking the PAN and Aadhaar card, the government will be able to link the identity of an entity through his/her Aadhaar card, and thus have details of all financial transactions made through the linked PAN card.
Ease in filing Income Tax Returns:
Entities and individuals will save a lot of hassle while filing their Income tax return, as they no longer have to submit their Income Tax acknowledgement to the IT department. By linking their Pan and Aadhar, the assesses wilssl be able to easily file their e-Returns.