Aadhaar-PAN Link Update (July 19): Possible to file ITR with inoperative PAN, new clarification for NRIs, OCIs

Aadhaar-PAN Link latest news (July 19): Amid concerns raised by certain NRIs/OCIs regarding their Permanent Account Numbers (PANs) becoming inoperative, the Income Tax Department has issued fresh clarifications and suggestions.

According to the tax department said non-Resident Indians (NRIs) and foreign citizens whose PANs have become inoperative due to non-linking with Aadhaar should submit proof of their residential status to the jurisdictional assessing officer (JAO) for operationalising the PAN.

Linking of PAN with Aadhaar is not mandatory for NRIs and OCIs who have confirmed their residential status to the tax department. However, many NRIs have complained that their PANs have become inoperative post the end of the deadline for Aadhar-PAN linking on June 30. (Read details here).

Aadhaar-PAN Link: Clarification

According to the tax department, it has mapped the residential status of NRIs in case they have filed the ITR in any of the last three Assessment Years or they have intimated their residential status to the Jurisdictional Assessing Officer (JAO).

The PANs have been rendered inoperative, in case any one of the above-mentioned criteria is not met.

What should NRIs do?

The NRIs whose PANs are inoperative have been 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.

Where to find details of JAO?

The details of JAO can be found at the e-filing portal – https://eportal.incometax.gov.in/iec/foservices/#/pre-login/knowYourAO

Whose PAN has become inoperative?

The Income Tax Department said that the PANs of OCIs/foreign citizens, who may have applied for PAN under resident status and have not corrected/updated their residential status to the Jurisdictional Assessing Officer (JAO) or have not filed ITR in any of the last three Assessment Years, have been rendered inoperative.

“The OCIs/foreign citizens 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 tax department said.

Can you file ITR with an inoperative PAN?

The Income Tax Department also clarified that an inoperative PAN is not an inactive PAN.

An individual can file the Income Tax Return (ITR), irrespective of PAN becoming inoperative. However, there are following consequences of ‘inoperative’ PAN:

• Pending refunds and interest on such refunds will not be issued to inoperative PANs.
• TDS will be required to be deducted at a higher rate for inoperative PANs in accordance with section 206AA.
• TCS will be required to be collected at a higher rate for inoperative PANs in accordance with section 206CC.