The income tax department on Tuesday asked taxpayers to link PAN with Aadhaar by May 31 to avoid tax deduction at a higher rate.

As per income tax rules, if a Permanent Account Number (PAN) is not linked with biometric Aadhaar, TDS is required to be deducted at double the applicable rate.

Last month, the income tax department issued a circular stating that no action will be taken for short deduction of TDS in case the assessee links his/her PAN with Aadhaar by May 31.

"Please link your PAN with Aadhaar before May 31, 2024, if you haven't already, in order to avoid tax deduction at a higher rate," the department posted on X.

In a separate post, the I-T department asked reporting entities, including banks, forex dealers, to file SFT by May 31 to avoid penalties.