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Finance Minister Nirmala Sitharaman has presented the new Income Tax Bill in the Lok Sabha, introducing significant changes that will directly impact taxpayers. This bill simplifies various PAN and Aadhaar-related rules, making compliance more straightforward. Below are the key changes and their implications.
PAN May Be Cancelled If Aadhaar Is Not Provided
According to the new bill:
- Individuals eligible for Aadhaar must provide their Aadhaar number when applying for a PAN or while filing Income Tax Returns (ITR).
- Those who already possess a PAN and are eligible for Aadhaar must inform the Income Tax Department about their Aadhaar number.
- Failure to provide Aadhaar may result in PAN cancellation.
Mandatory Update of Personal and Business Information
- If there is a change in name, address, or business details linked to a PAN, the taxpayer must inform the Income Tax Officer.
- If an individual does not have a PAN, they can use their Aadhaar number in place of PAN.
- If a person already possesses a PAN, they can still use their Aadhaar as PAN, provided they notify the Income Tax Department in advance.
Who Needs to Obtain a PAN?
The new bill mandates PAN issuance for:
- Individuals engaged in business or profession with total sales exceeding ₹5 lakh.
- Those holding key positions such as directors, partners, trustees, etc., in a company or institution.
- Individuals already possessing a PAN cannot apply for multiple PANs.
This new tax bill aims to streamline PAN and Aadhaar compliance while reducing fraudulent activities. Taxpayers must ensure they comply with these new rules to avoid penalties.
