The Government of India issues several different types of unique identification documents, required for various official uses, such as filing income tax returns, financial transactions, fund lending, etc.
Two of such documents are the Aadhaar and PAN card. These two are mandatory identification documents for individuals who are residing citizens of India.
Both PAN and Aadhaar card work as a unique identification proof and play a crucial role in various registration and verification process. One can even create a PAN Card Aadhaar Card link to create a unified system for documentation and verification.
Linking PAN and Aadhaar brings several advantages to Indian citizens. It addresses one of the most prevailing issues – having multiple PAN cards issued under one’s name. One can also get a summarised detail of all his taxes once the PAN Card link to Aadhaar is complete.
The Supreme Court endorsed Section 139AA of the Indian Income Tax Act, which makes Aadhaar number mandatory along with PAN while filing income tax returns. It is also necessary for individuals looking to avail income tax exemptions from personal loan. The same is also compulsory for individuals carrying out financial transactions above Rs. 50,000 at once.
Take a look at some of the benefits of linking PAN with Aadhaar card.
Exclude fake PAN cards –
The Central Board of Direct Taxes has detected over 10.52 Lakh fake and duplicate PAN cards belonging to individuals. Although that number accounts for only 0.4% of the total PAN cards allocated in India, it still caused a significant revenue deficit from various industries.
Eliminating fake PAN cards from the financial system serves a genuine state interest. A biometric-based PAN Aadhaar link can simplify the process and provide a guaranteed safeguard against any duplication of such an essential document.
Simplify document verification –
The Government of India has long been plagued by incorrect and lackluster verification process of PAN card issuing process. Recent studies show that proper verification of documents and relevant information happened in less than 0.2% of all the cases. Creating an Aadhaar card link with PAN will eliminate that issue and allow automated, biometric-based verification system for each individual.
It will also simplify the documentation process while applying for advances like a personal loan. A lender will be able to access the relevant information with ease by requesting the Aadhaar-linked documents.
Increase tax compliancy –
Individuals often do not quote PAN details during high-value transactions like the sale or purchase of property, movable asset, etc. It creates difficulty while tracking the transaction and calculating taxes based on the purchase. PAN card link to Aadhaar card will allow better monitoring of such large-scale purchases as it will be visible under a centralized database on that individual’s name.
The Indian Government will be able to track property handover, reduce illicit purchases, and collect taxes depending on the value of each transaction. Moreover, Aadhaar card will create a better identity proof for several transactions, making a better financial trail for individuals with malicious intent.
A user-friendly linkage process, simpler verification system, and robust measures to suppress any monetary deceits have necessitated the need to make PAN card link to Aadhaar.