What will happen to trades/investments if PAN and Aadhaar are not linked?

5 mins read
by Angel One
हिंदीతెలుగుગુજરાતીमराठी
Starting July 10th 2023, stock exchanges and CDSL will suspend the Demat accounts of investors whose PAN is not linked with Aadhaar. Read to find how to link your PAN and your Aadhaar.

The deadline for linking (seeding) your Permanent Account Number (PAN) with your Aadhaar is soon approaching. Starting July 10th 2023, stock exchanges and Central Depository Services (India) Limited (CDSL) will suspend the demat accounts of investors whose PAN is not linked with Aadhaar.

How will this impact your Angel One Demat account?

  1. New users of Angel One:

    If you don’t link your PAN with your Aadhaar, you will not be able to open a Demat account as stock exchanges and depositories will not accept the creation of a new user. Even if you initiate the Demat account opening process on Angel One, you will be stopped during the KYC process and it will only go through upon successful seed of your PAN and Aadhaar. On initiating the linking processes, you will be able to start trading after 7-8 working days.

  2. Existing users of Angel One:

    If you already have a Demat account with Angel One but your PAN-Aadhaar are not seeded, you will be prompted to link them at the earliest. Unless you do this, you will not be able to place fresh trades or square off existing positions. Trades will get through after 2-3 days of raising the linkage request.

  3. Inactive/dormant users of Angel One:

    If you have not done any trading activity via Angel One in the past 1 year, you will have to adhere to the re-KYC procedure. But to complete this process, you will have to link your PAN and your Aadhaar.

  1. Your Demat account will be suspended.
  2. Stock exchanges and CDSL will not accept buy/sell orders relating to your trades and investments:
    • You will be blocked from trading on NSE, BSE, and MCX.
    • You will not be allowed to buy or sell mutual fund units.

  3. You will not be able to square off your existing positions.
  4. Your SIP investments could get cancelled automatically. Ultimately, this would delay your financial goals.
  5. Your Margin-traded Funds (MTF) on Angel One would be impacted. You would not be able to pledge and unpledge your shares with Angel One.

What are the monetary consequences of not linking your PAN with your Aadhaar?

  1. If you fail to seed your documents, the IT department will charge a fee of Rs. 1000 before you submit the linkage request. You can pay the fee via the e-Pay Tax service. Visit https://eportal.incometax.gov.in/iec/foservices/#/pre-login/bl-link-aadhaar for more payment-related information.
  2. If you have paid the fee via the Protean (NSDL) portal, you can try linking your documents after 4-5 working days from the date of making the payment.

You can link your PAN with your Aadhaar by following these steps:

  1. Visit https://www.incometax.gov.in/iec/foportal/ to check if your PAN-Aadhaar is already linked. Click on ‘Link Aadhaar Status’ on the left-hand side. Enter your PAN and Aadhaar number and click on ‘View Link Aadhaar Status >’
  2. If not linked, you can link them by selecting Select ‘Link Aadhaar Status’ option on the same page – https://www.incometax.gov.in/iec/foportal/
  3. Enter your PAN and your Aadhaar details and click on ‘Validate’
  4. If you get a pop-up window saying “Payment details not found for this PAN”, you need to pay the fee by clicking on ‘Continue to Pay Through E-Pay Tax’
  5. Enter your PAN, reconfirm PAN, fill in your mobile number and click on ‘Continue’
  6. Enter a 6-digit OTP and click on ‘Continue’ to verify it
  7. Now click ‘Continue’ again to pay
  8. Select ‘Assessment Year 2023-24’ and ‘Other receipts (500)’
  9. Click ‘Continue’ to verify the amount
  10. Continue to select your payment method. Complete your payment and download the receipt
  11. Check if your payment is processed after 4-5 days by visiting https://www.incometax.gov.in/iec/foportal/ and clicking on ‘Link Aadhaar’
  12. After 4-5 days of making the payment, visit https://www.incometax.gov.in/iec/foportal/ and click on ‘Link Aadhaar Status’ option
  13. If your payment is received, click on ‘Continue’
  14. On the next page, enter your Name as per your Aadhaar and mobile number. Tick the applicable checkboxes and click on ‘Link Aadhaar’ option
  15. Next, validate your OTP
  16. After 4-5 days, repeat Step 1 to check on your ‘Link Aadhaar Status’

Read more about “Link Aadhar with Demat Account”

If you are linking your PAN and Aadhaar after July 10th 2023, it may take up to 7-8 working days for the link status to be updated in your income tax records. However, there might be delays in syncing data between income tax records and CDSL. Therefore, it may take even longer for trading to be allowed on your account. There may be mismatches in the status between exchanges – therefore, orders on one exchange might go through but not on others. Order placements from your account will be enabled only after the depositories and the exchanges update the status. We will be in touch with all the stakeholders continuously to minimise disruptions your trading.

Final words

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