The clock is ticking for taxpayers across India. The Income Tax Department has issued a final, urgent reminder: individuals must link their Permanent Account Number (PAN) with their Aadhaar card by today, Wednesday, December 31, 2025.
If this mandatory requirement is not met by midnight, your PAN card will become inoperative. This means you will face significant hurdles in daily financial life, including the inability to file tax returns, process pending refunds, or even open new bank accounts.
The Cost of Delay: Penalties and Exemptions
While the government has provided several extensions in the past, the current deadline carries a financial consequence for late adopters.
- Standard Penalty: Most taxpayers who have not yet linked the two documents must pay a late fee of ₹1,000 through the e-filing portal before they can initiate the link.
- Exemption Rule: There is a minor reprieve for new applicants. Those who obtained their PAN card after October 1, 2024, using an Aadhaar enrollment ID, are exempt from the penalty. They can complete the linking process for free, provided it is done before the end of the day.
Step-by-Step Guide to Link Your PAN and Aadhaar
To avoid a last-minute rush and technical glitches, follow these steps on the official Income Tax e-filing portal immediately:
- Login: Visit the official portal and log in using your credentials.
- Locate Option: Navigate to your profile section and select the ‘Link Aadhaar’ button.
- Payment: Enter your PAN and Aadhaar details. If the fee is applicable, click ‘Continue to pay through e-pay tax’.
- Challan Generation: Select the relevant Assessment Year (2025-26) and choose the payment type as ‘Other Receipts (500)’. The ₹1,000 amount will be pre-filled.
- Complete Transaction: Pay the fee via your preferred banking method.
- Finalize Linking: Once the payment is successful (it may take a few minutes to update), return to the ‘Link Aadhaar’ section to complete the submission.
Pro Tip: After completing the process, you can verify your status by clicking on ‘Link Aadhaar Status’ on the portal’s homepage. Simply enter your details to ensure the two are successfully synced.
Consequences of an Inoperative PAN
An inoperative PAN is more than just a dormant card. Without a valid PAN, you may face higher Tax Deducted at Source (TDS) rates, inability to invest in mutual funds, and delays in high-value property or vehicle transactions.