The last date for tax filing in India is July 31, 2023. Failure to meet this deadline will result in fines imposed on the taxpayer.
During the tax filing period, the Indian Income Tax Department provides guidance on how to complete the process through their Twitter account.
Recently, the Income Tax India Portal tweeted about concerns raised by certain Non-Resident Indians (NRIs) and Overseas Citizens of India (OCIs) regarding the inoperability of their Permanent Account Numbers (PANs), even though they are exempt from linking their PAN with Aadhaar.
To clarify the situation, the following points have been provided:
- NRIs who have filed Income Tax Returns (ITRs) in any of the last three assessment years or have informed their Jurisdictional Assessing Officer (JAO) about their residential status have had their PANs rendered inoperative. NRIs with inoperative PANs are requested to inform their respective JAOs about their residential status, providing supporting documents, and request an update to their PAN database.
- PANs of OCIs and foreign citizens who may have applied for PAN under the resident status but have not corrected/updated their residential status with the JAO or have not filed ITRs in any of the last three assessment years have also been rendered inoperative. OCIs and foreign citizens in this situation are requested to inform their respective JAOs about their residential status, provide supporting documents, and request an update to their PAN database.
- It is important to note that an inoperative PAN is not the same as an inactive PAN. Taxpayers can still file their Income Tax Returns (ITRs) regardless of their PAN's inoperative status.
However, there are certain consequences associated with an inoperative PAN:
- Pending refunds and interest on such refunds will not be issued for inoperative PANs.
- Tax Deducted at Source (TDS) will be deducted at a higher rate for inoperative PANs, as per Section 206AA.
- Tax Collected at Source (TCS) will be collected at a higher rate for inoperative PANs, as per Section 206CC.
For detailed information, the Income Tax India tweet directs taxpayers to refer to CBDT Notification No.15/2023 dated March 28, 2023, available at: https://incometaxindia.gov.in/communications/notification/notification-15-2023.pdf