Hello Readers! 

It was earlier announced by the government that every individual who bears a PAN (Private Account Number) card, must link it with their Aadhar card before 1st April 2021. If they fail to do it on time then Your Permanent Account Number (PAN card) will turn useless from April 1, 2021!!

Well, the deadline has been extended till June 30, 2021, for linking your PAN with the Aadhaar. If you are still not with the wave, we suggest you, link your PAN with Aadhar today. Because this time if you fail to do so on time, might be you would have to face some nasty situations in July 2021, with your mutual fund units that you hold.

This time the government has added a penalty of Rs 10,000 if you fail to link your PAN with Aadhar before the deadline. And most important, your PAN itself might become invalid or inoperative if you don’t link it with your Aadhar In time.

What Will Happen When Your PAN Becomes Invalid?

While you start to invest in mutual funds, very first you need to get yourself registered under KYC. And to complete the KYC process you must have a valid PAN. Suppose you have your investment in a mutual fund and because of some reason you fail to link your PAN with your Aadhar before the deadline, then your PAN will become invalid. As the PAN becomes invalid, documentation related to your PAN card, like your KYC registration will also become invalid. That simply means you will not be able to invest in mutual funds.

After your PAN gets invalid, there would be a kind of restriction in your mutual fund investments that you would have to face. Fresh investments or redemptions will be prohibited. Your previous and ongoing systematic investment plans (SIPs) will also be stopped. This might also affect your redemptions. However, there is no specification mentioned by the income tax department regarding the redemption, but the industry says that even redemptions will need to stop if an investor’s PAN is not linked with Aadhaar.

What Other Sections Will Be Affected If PAN Not Linked With Aadhar?

Well, not linking your PAN to Aadhar is not only going to affect your investments, but also your saving bank account and many other things. An official said that banks too have informed their customers regarding this. They said that if customers' PANs are not seeded with their Aadhaar numbers, their savings bank account would be frozen. Withdrawals will be restricted, but credits would be allowed.

Not only this but an individual whose PAN is not linked with his Aadhar would face issues while opening a bank account applying for a credit or debit card, buying debentures, bonds or even investing in small-saving instruments above Rs 50,000.

How Can We Link PAN to Aadhar?  

Well, you can link your PAN with your Aadhar card on your own via three methods, first via ONLINE mode, second via an OFFLINE mode that is manually, and third via SMS service.

Link Your PAN With Aadhar Via Online Mode!! 

  • You can go to the income tax department's e-filing portal to link your PAN with Aadhaar.
  • Click on the Link Aadhaar section on the left.
  • You need to fill PAN number, Aadhaar number, and name.
  • Fill in the CAPTCHA.
  • Click at the 'Link Aadhaar' option and your PAN Aadhaar Linking will get complete.
  • The I-T department will validate your name, date of birth, and gender against Aadhaar details after which the linking will be done.

Link Your PAN With Aadhar Manually!!

  • Visit a service center for PAN
  • Fill in a form 'Annexure-I' along with supporting documents - a copy of the PAN card and the Aadhaar card
  • Submit the form.
  • this service is not free of charge like the online mode, the individual is required to pay a prescribed fee to the service center.

Link Your PAN With Aadhar Via SMS!!

If you are feeling difficult to link your PAN and Aadhaar using the e-filing website of the department then no need to worry you can do it via sending an SMS. Just pick up your phone that has a number that is registered with your PAN and Aadhar Documents. Type UIDPAN and send it 567678 or 56161 from the registered mobile number.

Here is the format: UIDPAN (12-digit Aadhaar number) (10-digit PAN) and send it to 567678 or 56161.

If you have not linked your PAN and Aadhar with each other, then do it asap, before you become liable to pay the penalty.

Keep reading for more updates on Finance and Investment!!

For any kind of query you can contact us at Shri Ashutosh Securities Pvt Ltd., we are here to help you in any way possible.

Happy Investing!

(Mutual Fund investments are subject to market risk Illustrations are for example only, there is no guarantee of returns. Past performance is not an indicator/guarantee to future returns).