A permanent account number (PAN) that has become inoperative due to not being linked with the Aadhaar card, is not the same as an inactive PAN, the Income Tax Department clarified on July 18, amidst confusion over income tax return (ITR) filings.
"It is clarified that an inoperative PAN is not an inactive PAN. One may file the Income Tax Return (ITR), irrespective of PAN becoming inoperative," the taxation body said in a statement.
However, there will be consequences of an inoperative PAN, such as the "pending refunds and interest on such refunds will not be issued to inoperative PANs".
Also, the tax deducted at source (TDS) will be deducted at a "higher rate for inoperative PANs", it said. Similarly, the tax collected at source (TCS) will be "collected at a higher rate for inoperative PANs", the I-T Department added.
Also Read | Know the nuts and bolts of income tax return-filing process for FY22-23
Clarification on NRI PANs
The PANs of overseas citizens of India (OCI) or foreign citizens, who may have applied for PAN under resident status and have not updated their residential status before the Jurisdictional Assessing Officer (JAO), have been rendered inoperative, the I-T Department pointed out.
Similarly, the PANs of OCI cardholders or foreign citizens who have not filed ITR in any of the last three assessment years (AYs) have been rendered inoperative, it noted.
"The NRIs (non-residential Indians) whose PANs are inoperative are requested to intimate their residential status to their respective JAO along with supporting documents with a request to update their residential status in the PAN database," the statement said.
Also Read | Inoperative PAN cards distress NRIs
The clarification comes amid the concerns raised by a number of taxpayers, including NRIs, over the filing of ITRs with PANs that have not been linked with Aadhaar. The last date for filing the returns for AY-2023 is July 31, 2023.
Earlier, the deadline for linking the 12-digit Aadhaar number with the PAN card lapsed on June 30.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
