PAN, Aadhaar now mandatory for cash transactions above this amount

PAN is currently required for cash deposits of Rs 50,000 or more per day. With these restrictions, a total annual threshold of Rs 20 lakh has been set.From which date it is applicableOn May 10, 2022, the Central Board of Direct Taxes (CBDT) issued a notification in this regard. The new regulations will take effect on May 26, 2022.What notification statedAs per the notification, “Every person shall, at the time of entering into a transaction specified in column (2) of the Table below, quote his permanent account number or Aadhaar number, as the case may be, in documents pertaining to such transaction, and every person specified in column (3) of the said Table, who receives such document, shall ensure that the said number has been duly quoted and authenticated.”

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The notification further states, “The permanent account number or Aadhaar number along with demographic information or biometric information of an individual shall be submitted to the Principal Director General of Income-tax (Systems) or Director General of Income-tax (Systems) or the person authorised by the Principal Director General of Income-tax (Systems) or Director General of Income-tax (Systems) with the approval of the Board, for the purposes of authentication referred to in section 139A.

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As per the notification, every person to obtain and quote Permanent Account Number (“PAN”), wherein he enters into any of the following transactions:

• Cash deposits aggregating to Rs 20 lakhs or more in the financial year in one or more accounts with a bank or a post office.
• Cash withdrawal or withdrawal aggregating to Rs 20 lakhs or more in the financial year in one or more accounts with a bank or a post office.
• Opening of current account or cash credit account.

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The deadline for maintaining your PAN active without linking it to your Aadhaar has been extended from March 31, 2022 to March 31, 2023. However, starting April 1, 2022, linking your PAN and Aadhaar will cost you money. The Central Board of Direct Taxes (CBDT) notified this via a notification dated March 29, 2022, as well as a press release on March 30, 2022.

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