INCOME TAX PORTAL UPDATE: Aadhaar OTP Verification Now Mandatory for E-Filing – What You Need to Know

The Income Tax e-Filing portal has made an important update that directly affects how taxpayers verify their Income Tax Returns (ITRs) and access other online services. From now on, Aadhaar OTP (One-Time Password) verification is mandatory for completing these important tasks. This change highlights the government’s focus on increasing digitization, security, and smooth integration of taxpayer data.

The New Mandate: What Exactly Has Changed?

Although Aadhaar OTP has been an easy option for ITR verification for a while, making it mandatory means it will now be the main or required way to authenticate various key functions on the e-Filing portal. This change affects not just ITR verification but possibly other services like PAN registration and password resets, where Aadhaar OTP has become an essential step.

For e-verifying your ITR, Aadhaar OTP is now widely used and often the main method. Remember, ITR verification must be done within 30 days of filing to ensure your return is valid. If you miss this deadline, your ITR may be considered "not filed," leading to penalties and possible delays in refunds.

Why the Shift to Mandatory Aadhaar OTP?

This decision aligns with several main goals of the Income Tax Department:

• Improved Security: Aadhaar-based OTP adds a strong layer of security. Since the OTP goes to the mobile number registered with your Aadhaar, it ensures that only the rightful individual can verify the transaction. This helps prevent fraud and confirms the authenticity of submissions.
• Simplified Process: For millions of taxpayers, Aadhaar OTP provides the quickest and easiest way to verify their ITRs. It removes the need to physically submit ITR-V forms to CPC Bengaluru, saving both time and effort.
• Data Accuracy and Integration: By requiring Aadhaar OTP, the Income Tax Department improves the connection between the Aadhaar database and tax records, enhancing data accuracy and minimizing discrepancies. This can lead to quicker processing of returns and faster refunds.
• Digital India Initiative: This step is part of the government's broader "Digital India" and "e-governance" programs, which aim to promote digital skills and online transactions for essential services.

Impact on Taxpayers: Are You Ready?

This update has immediate effects for all taxpayers. Here’s what you need to do to be prepared:

Linking Aadhaar and PAN is Essential:

The key to this mandate is successfully linking your Aadhaar with your Permanent Account Number (PAN). If your PAN isn’t linked to your Aadhaar, it will become "inoperative." This can result in several consequences, including:

• No tax refunds will be issued.
• No interest will be payable on refunds.
• Tax will be deducted (TDS) or collected (TCS) at a higher rate.
• You will not be able to file ITRs or perform many financial transactions.

The deadline for linking PAN with Aadhaar for existing PAN holders was June 30, 2023, with a penalty of Rs. 1,000 for late linking. However, you can still link them after this date, although with a penalty. For new PAN applicants, Aadhaar authentication has been mandatory since July 1, 2025.

Update Your Mobile Number with Aadhaar:

Your mobile number linked to Aadhaar is very important. The OTP will be sent only to this number. If your mobile number is outdated or incorrect in your Aadhaar records, you cannot use Aadhaar OTP for verification. You need to visit an Aadhaar Seva Kendra or enrollment center to update your mobile number, as online updates aren’t allowed due to biometric verification rules.

Alternative Verification Methods (Still Available but Aadhaar OTP is Preferred):

While Aadhaar OTP is becoming more popular, other methods for e-verifying your ITR generally remain available:

• EVC via Bank Account: Through a pre-validated bank account.
• EVC via Demat Account: Through a pre-validated Demat account.
• EVC via ATM: Some banks allow EVC generation through ATMs.
• Net Banking: Access the e-filing site directly via net banking.
• Digital Signature Certificate (DSC): Required for certain categories like companies and individuals with income over ₹50 lakh.
• Physical Verification (ITR-V): Sending a signed ITR-V to CPC Bengaluru, although this is the least preferred method due to delays.

For many other portal functions and for convenience, Aadhaar OTP is increasingly emphasized.

What to Do If You're Not Ready?

If you haven’t linked your Aadhaar with PAN or your mobile number isn’t updated in your Aadhaar, take these steps right away:

Link PAN with Aadhaar:

• Visit the Income Tax e-Filing portal (incometax.gov.in).
• Use the "Link Aadhaar" quick link.
• Enter your PAN and Aadhaar number, pay any fee if required, and finish the linking process.
• You can also check the linking status on the portal.

Update Mobile Number in Aadhaar:

• Find your nearest Aadhaar Seva Kendra or enrollment center.
• Book an appointment online (recommended) at the UIDAI website (uidai.gov.in).
• Go to the center with valid documents and get your mobile number updated. The update process might take 2-4 weeks to reflect.

The Road Ahead

The requirement of Aadhaar OTP verification on the Income Tax e-Filing portal signals a move toward a more secure, efficient, and digitally integrated tax system in India. While taxpayers may need some time to ensure their details are current and linked, the long-term benefits of easier compliance and better security are clear. Stay informed, keep your details updated, and embrace the digital transformation in income tax filing.

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