July 20, 2023: Non-resident Indians (NRIs) and foreign citizens whose permanent account numbers have been made inoperative because those were not linked with Aadhaar, should submit documentary proof of their residential status with their jurisdictional assessing officer (JAO) to make the PAN operational once more, the income tax department said in a tweet on July 18.
“The NRIs 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. Details of JAO can be found at: https://eportal.incometax.gov.in/iec/foservices/#/pre-login/knowYourAO,” the tweet read.
Concerns were raised by certain NRIs and overseas citizens of India regarding their PANs becoming inoperative although they are exempted from linking their PAN with Aadhaar, the department said.
The last day for linking the PAN with Aadhaar was June 30, 2023. From July 1, 2023, PANs of those taxpayers who failed to link the two documents have become inoperative. However, unlike resident Indians who are required to link their PANs with Aadhaar under the income tax law, NRIS are not required to get an Aadhaar.
“PAN holders whose PANs have been rendered inoperative due to non-linking of PAN with Aadhaar have expressed concern over certain consequences of PAN becoming inoperative,” the I-T department said in the tweet while adding that it had mapped the residential status of NRIs in case they have filed their income tax return (ITR) in any of the last three assessment years or in case they intimated their residential status to the jurisdictional assessing officer.
“The PANs have been rendered inoperative in case any one of the above-mentioned criteria is not met,” it said.
“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 JAO or have not filed ITR in any of the last three assessment years have been rendered inoperative,” it added.
Consequences of inoperative PAN
The department clarified that an inoperative PAN was not an inactive PAN. This meant that one might file the ITR irrespective of PAN becoming inoperative. However, in case of an inoperative PAN, pending refunds and interest on such refunds will not be issued.
Also, TDS (tax deducted at source) will be required to be deducted at a higher rate for inoperative PANs in accordance with Section 206AA, the department said. “TCS (tax collected at source) will be required to be collected at a higher rate for inoperative PANs in accordance with Section 206CC,” it added.
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An alumna of the Indian Institute of Mass Communication, Dhenkanal, Sunita Mishra brings over 16 years of expertise to the fields of legal matters, financial insights, and property market trends. Recognised for her ability to elucidate complex topics, her articles serve as a go-to resource for home buyers navigating intricate subjects. Through her extensive career, she has been associated with esteemed organisations like the Financial Express, Hindustan Times, Network18, All India Radio, and Business Standard.
In addition to her professional accomplishments, Sunita holds an MA degree in Sanskrit, with a specialisation in Indian Philosophy, from Delhi University. Outside of her work schedule, she likes to unwind by practising Yoga, and pursues her passion for travel.
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