In case, the taxpayer fails to intimate Aadhaar number to the Income-tax department, the PAN allotted to the taxpayer shall be deemed to be invalid and the taxpayer will be treated as a non-pan holder.
Some of the consequences of PAN being treated as invalid are as follows:-
- TDS will be deducted @ 20%(or applicable rate whichever is higher) instead of normal TDS Rates.
- A penalty of 10000 may be imposed on the taxpayer for not holding PAN.
- The taxpayer can file his return but his/her return will not be processed until his Aadhaar number will not get linked to his PAN number.