Aadhaar OTP a Must for PAN Registration: New Income Tax Portal Rule

PAN

New PAN Registration Rule: Aadhaar OTP Verification Made Mandatory

PAN

In a significant update, the Income Tax Department has introduced a mandatory Aadhaar-based OTP verification step for individuals registering their Permanent Account Number (PAN) on the official e-filing portal — www.incometax.gov.in.

This change is designed to enhance security and ensure that only genuine users are able to initiate the PAN registration process. Here’s everything you need to know about the new process and what it means for taxpayers.

What’s New in PAN Registration?

As part of the updated registration process, individuals must now:

  • Consent to Aadhaar Authentication: During registration, users must allow validation through the UIDAI (Unique Identification Authority of India) database.

  • Verify via Aadhaar OTP: A One-Time Password (OTP) will be sent to the mobile number linked with the applicant’s Aadhaar. This OTP must be entered to complete the registration.

Without completing this Aadhaar OTP authentication, the PAN registration process on the Income Tax Department portal cannot proceed.

PAN

Why Aadhaar OTP Verification Is Crucial

The mandatory Aadhaar OTP step serves multiple purposes:

  • ✅ Enhanced Identity Verification: Helps prevent fraudulent or duplicate PAN registrations.

  • ✅ Faster PAN-Aadhaar Linking: Simplifies the integration process as required by law.

  • ✅ Legal Compliance: Under Section 139AA of the Income Tax Act, linking PAN with Aadhaar is a legal necessity.

What Should Taxpayers Do?

To ensure a hassle-free PAN registration process:

  1. Check Your Aadhaar-Mobile Link: Make sure your Aadhaar is linked to an active mobile number.

  2. Update If Needed: If your Aadhaar is not linked with a mobile number, visit the nearest Aadhaar Seva Kendra to update your contact details.

  3. Be Ready for OTP: Once linked, keep your mobile device handy to receive and enter the OTP during PAN registration.

Read More: Income Tax Benefits for Senior Citizens: What You Can Claim in AY 2025-26

The mandatory Aadhaar OTP verification adds an essential layer of security and aligns with the government’s broader digital authentication goals. For individuals looking to register their PAN online, ensuring a valid Aadhaar-linked mobile number is now the first and most critical step.

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PAN 2.0: A Revolutionary Upgrade to the PAN Ecosystem

PAN 2.0

PAN 2.0: A Revolutionary Upgrade to the PAN Ecosystem

PAN 2.0

In a major step towards enhancing India’s digital infrastructure, the Cabinet Committee on Economic Affairs (CCEA), chaired by Prime Minister Narendra Modi, has approved the PAN 2.0 Project for the Income Tax Department. With a financial outlay of ₹1,435 crore, this initiative aims to re-engineer taxpayer registration services through advanced technology, aligning with the vision of Digital India.

Union Information and Broadcasting Minister Ashwini Vaishnaw shared that the project will offer a free-of-cost upgrade to PAN Cards, introducing QR codes for improved usability and security.

What is the PAN 2.0 Project?

The PAN 2.0 Project represents a transformation of the existing PAN/TAN 1.0 ecosystem. It consolidates core and non-core activities, introduces enhanced features, and redefines the taxpayer experience.

Key objectives include:

  • Technology-Driven Transformation: Overhauling the PAN issuance and verification systems to deliver a seamless digital experience.
  • Enhanced Service Delivery: Faster, eco-friendly, and higher-quality services for taxpayers.
  • Centralized Data Consistency: Establishing a Single Source of Truth for reliable and uniform information across systems.
  • Optimized Infrastructure: Ensuring cost-effectiveness, security, and agility in operations.

Core Features of PAN 2.0

  1. QR Code Integration:

    • PAN cards will feature QR codes, making them easier to validate and use across digital platforms.

  2. Unified and Paperless Processes:

    • A single, streamlined portal will simplify PAN-related services, reducing paperwork and expediting service delivery.

  3. Enhanced Grievance Redressal:

    • A robust, user-friendly system will address taxpayer issues promptly and efficiently.

  4. Eco-Friendly Operations:

    • By digitizing processes, the project aims to minimize environmental impact.
PAN 2.0

Benefits of the Upgrade

  • Ease of Access: Taxpayers will experience faster, more convenient service.
  • Seamless Integration: PAN will function as a common identifier for specified government agencies, aligning with the Digital India initiative.
  • Data Security: Enhanced systems will ensure the safety of taxpayer information.
  • Cost Optimization: Advanced infrastructure will reduce operational costs.

Frequently Asked Questions

1. Do I need a new PAN card?

No, your current PAN card will remain valid. The upgrades, including the addition of QR codes, will be applied automatically.

2. Will the upgrades cost anything?

No, the upgrade is entirely free of charge for taxpayers.

3. What is a PAN card?

The Permanent Account Number (PAN) is a unique 10-character alphanumeric identifier issued by the Income Tax Department. It links individuals and entities with their tax-related transactions and communications, serving as a crucial document for financial activities in India.

Read More: Key Changes in GST Annual Return for FY 2023-24: A Guide to Filing Without Errors

PAN 2.0: A Step Towards Digital India

This project underscores the government’s commitment to digital transformation, eco-friendly initiatives, and taxpayer convenience. By integrating advanced technology into the PAN system, India takes another leap towards creating a seamless and secure digital ecosystem for its citizens.

The PAN 2.0 upgrade is not just a technological enhancement—it’s a vision for the future of governance, bridging convenience, security, and sustainability.

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Income Tax Department Releases Step-by-Step Guide to Link Aadhaar and PAN to Prevent Higher TDS

Link Aadhaar & PAN

Income Tax Department Releases Step-by-Step Guide to Link Aadhaar and PAN to Prevent Higher TDS

Link Aadhaar & PAN

The Income Tax Department released a comprehensive guide that provides step-by-step directions for individuals to link their Permanent Account Number (PAN) with their Aadhaar number. The goal of this program is to make the process easier for taxpayers and stop higher Tax Deducted at Source (TDS) rates from being deducted.

Taxpayers can avoid paying higher TDS rates on a variety of financial activities and income sources by connecting their PAN and Aadhaar.

Attention, Taxpayers! The income tax department wrote on May 29 on social media site X, “Remember to link your PAN with your Aadhaar before May 31st, 2024, to avail the benefits of CBDT Circular No.6/2024 dtd 23rd April 2024.”

Link Aadhaar & PAN

Steps to Link Your PAN with Aadhaar

1) Visit the e-Filing Portal Home page and click on ‘Link Aadhaar’ in the Quick Links section, or log into the e-Filing portal and click on ‘Link Aadhaar’ in the Profile section.

2) Enter your PAN and Aadhaar Number.

3) Click on ‘Continue’ to Pay Through e-Pay Tax.

4) Enter your mobile number to receive OTP.

5) After OTP verification, you will be redirected to the e-Pay Tax page.

6) Click on ‘Proceed’.

7) Select the relevant Assessment Year and Type of Payment as ‘Other Receipts’ (500) and click ‘Continue’.

8) After successful payment, revisit the ‘ Link Aadhaar’ page.

9) Once the payment details are verified, click ‘continue’ to submit the PAN-Aadhaar link request.

According to the CBDT circular dated April 23, 2024, following the notification substituting rule 114AAA of the Income-tax Rules, 1962:

  • If a person fails to link their Aadhaar with PAN as per section 139AAA of the Income-tax Act, 1961, their PAN will become inoperative.
  • Tax refunds will not be processed.
  • No interest will be payable on tax refunds for the period when the PAN is inoperative.
  • Tax will be deducted at a higher rate under Chapter XVII-B as per section 206AA.
  • Tax will be collected at a higher rate under Chapter XVII-BB as per section 206CC.
Link Aadhaar & PAN

Why is PAN-Aadhaar linking important?

  • Your PAN will become inoperative if it is not linked with Aadhaar.
  • Tax refunds will not be processed.
  • No interest will be payable on tax refunds.
  • Tax will be deducted at a higher rate.
  • Tax will be collected at a higher rate as per the provisions of section 206CC.

Read More: 9 Major Transactions to Watch Out For to Avoid Income Tax Scrutiny

Due date for FY 2023–2024 ITR filing

Without incurring any late fees, the deadline for filing your Income Tax Returns (ITR) for the income received in FY 2023-24 (AY 2024-25) is July 31, 2024.

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