The Permanent Account Number (PAN) is an important document to file your Income Tax Returns (ITRs) if your earning falls under the taxable income slabs.
But in the last budget, Aadhaar Card was proposed to be used as an alternative of PAN Card. It means that if you don’t have a PAN Card, but an Aadhaar Card, then you would be able to quote it for multiple tasks.
Do you wish to know more? Read on!
Can you now use your Aadhaar Card as an alternative of your PAN Card?
That’s what the budget speech of the Finance Minister Nirmala Sitharaman suggests! She had proposed to make Aadhaar, the 12-digital Unique Identity interchangeable with PAN.
The move comes after multiple attempts of the Central Government to force citizens to link their Aadhaar Card and PAN Card to weed out those evading taxes was just a ho-hum affair. Despite such efforts, the Finance Minister is now proposing to make Aadhaar and PAN interchangeable.
What does this mean?
Sitharaman, in her budget speech, informed the house that more than 120 Indians now have Aadhaar. Thus, she was proposing to make PAN and Aadhaar interchangeable for the ease and convenience of taxpayers.
This way, it would let such people who do not yet have a PAN to file their ITRs to do that by only providing their 12-digit Aadhaar. It was also proposed to use Aadhaar details wherever it was mandatory to furnish PAN details.
Does that make Aadhaar and PAN interchangeable?
No, and even if they maybe – it maybe in some situations and not entirely.
What the Finance Minister had proposed was allowing Aadhaar details to be used in place of PAN, but the catch is that it is not vice-versa. In other words, it may be possible to quote your Aadhaar details for carrying out financial transactions and for filing ITRs.
But you may still not be able to use PAN details where Aadhaar for welfare schemes or the distribution of subsidies such as LPG connection is mandatory.
To avail of such schemes of the Government and subsidies in your bank account, you will still have to quote your Aadhaar details and not PAN.
Does that also mean that there is no need to link Aadhaar with PAN?
No. The linking of Aadhaar with PAN is still very much valid and mandatory. You still need to provide your Aadhaar number while filing the Income Tax Returns (ITRs).
The last date for PAN-Aadhaar linking was 31st December 2019. However, it has now been extended until the end of the financial year, which is 31st March 2020.
Therefore, if you fail to link your Aadhaar with PAN by that date, it may be at the risk of becoming ‘inoperative.’ Earlier, the law stated that such cards not being linked would become invalid.
But in the recent Finance Bill, the language seems to have been altered and simply states that they would go inoperative.
Why the Government then wants you to use Aadhaar instead of PAN?
The proposal of the Finance Ministry is not directed towards those who are not looking to their Aadhaar with PAN, which it still considers obligatory.
The move is directed at a bigger picture to bring more people into the net of tax payment even without having a PAN Card. If you don’t have a PAN Card you can apply for a PAN Card online.
Thus, it means that if you have an Aadhaar Card and still don’t have a PAN Card, then you don’t have to be concerned about not having it while filing the ITRs.
Your Aadhaar Card details will be enough to carry out transactions in India as well as help you pay income taxes and more.
