PAN and Aadhaar linkage: what the status really means
Linked, not linked, or exempt. Each PAN-Aadhaar status has consequences for TDS, refunds and account operation. Here is how to read it.
Why linkage exists
PAN-Aadhaar linkage was mandated to de-duplicate identities and curb multiple-PAN fraud. An unlinked PAN becomes inoperative, which does not mean deleted (the number still exists) but it triggers higher TDS, blocked refunds, and rejection in many KYC flows.
For a business onboarding customers or vendors, an inoperative PAN is a real operational risk: payments to that party attract TDS at the higher rate, and the mismatch can surface in a later audit.
Reading the status field
A linkage check returns one of a few states: linked, not linked, linkage in progress, or exempt (certain residents, senior citizens in specified states, and non-residents are exempt). Map "not linked" to a soft block: ask the user to link and come back, rather than a hard reject, because linkage is a same-day fix on the income-tax portal.
If your use case is vendor payments, store the status with a timestamp and re-check before large disbursements. Status can change between onboarding and payout.
Common failure patterns
The most common reason a genuine PAN shows "not linked" is a name or date-of-birth mismatch between the two databases: a middle name present in one and not the other, or a date entered in a different order years ago. The fix is a correction request on either the PAN or Aadhaar record, not a re-application.
Do not advise users to apply for a fresh PAN to resolve a linkage mismatch. Holding two PANs is itself an offence and will get both deactivated.