Description

Pan Card Apply

A permanent account number is a ten-character alphanumeric identifier Foundational ID, issued in the form of a laminated “PAN card”, by the Indian Income Tax Department, to any person who applies for it or to whom the department allots the number online & Offline an application.

---

WHAT IS PAN?

Permanent Account Number (PAN) is a ten-digit alphanumeric number, issued in the form of a laminated card, by the Income Tax Department, to any “person” who applies for it or to whom the department allots the number without an application.

PAN enables the department to link all transactions of the “person” with the department. These transactions include tax payments, TDS/TCS credits, returns of income, specified transactions, correspondence, and so on. PAN, thus, acts as an identifier for the “person” with the tax department.

PAN was introduced to facilitates linking of various documents, including payment of taxes, assessment, tax demand, tax arrears etc. relating to an assessee, to facilitate easy retrieval of information and to facilitate matching of information relating to investment, raising of loans and other business activities of taxpayers collected through various sources, both internal as well as external, for detecting and combating tax evasion and widening of tax base.

A typical PAN is AFZPK7190K.

First three characters i.e. “AFZ” in the above PAN are alphabetic series running from

AAA to ZZZ

Fourth character of PAN i.e. “P” in the above PAN represents the status of the PAN holder. “P” stands for Individual, “F” stands for Firm, “C” stands for Company, “H” stands for HUF, “A” stands for AOP, “T” stands for TRUST etc.

Fifth character i.e. “K” in the above PAN represents first character of the PAN holder’s last name/surname.

Next four characters i.e. “7190” in the above PAN are sequential number running from 0001 to 9999.

Last character i.e. “K” in the above PAN is an alphabetic check digit.

WHY IS IT NECESSARY TO HAVE PAN?

It is mandatory to quote PAN on return of income, all correspondence with any income tax authority. From 1 January 2005 it has become mandatory to quote PAN on challans for any payments due to Income Tax Department.

It is also compulsory to quote PAN in all documents pertaining to the following financial transactions :-

   1)  Sale or purchase of a motor vehicle or vehicle other than two wheeled vehicles.

   2)  Opening an account [other than a time-deposit referred at point No. 12 and a Basic Savings Bank Deposit Account] with a banking company or a co-operative bank

   3)  Making an application for issue of a credit or debit card.

   4)  Opening of a demat account with a depository, participant, custodian of securities or any other person with SEBI

   5)  Payment in cash of an amount exceeding Rs. 50,000 to a hotel or restaurant against bill at any one time.

   6)  Payment in cash of an amount exceeding Rs. 50,000 in connection with travel to any foreign country or payment for purchase of any foreign currency at any one time.

   7)  Payment of an amount exceeding Rs. 50,000 to a Mutual Fund for purchase of its units

   8)  Payment of an amount exceeding Rs. 50,000 to a company or an institution for acquiring debentures or bonds issued by it.

   9)  Payment of an amount exceeding Rs. 50,000 to the Reserve Bank of India for acquiring bonds issued by it.

 10)  Deposits of cash exceeding Rs. 50,000 during any one day with a banking company or a co-operative bank.

10A)    Deposits of cash aggregating to more than Rs. 2,50,000 during the period of 09^th November 2016 to 30^th December 2016 with a banking company, cooperative bank or post office.

 11)  Payment in cash for an amount exceeding Rs. 50,000 during any one day for purchase of bank drafts or pay orders or banker’s cheques from a banking company or a co-operative bank.

12)  A time deposit of amount exceeding Rs. 50,000 or aggregating to more than Rs. 5 lakh during a financial year with –

   (i)  a banking company or a co-operative bank

  (ii)  a Post Office;

 (iii)  a Nidhi referred to in section 406 of the Companies Act, 2013  or

 (iv)  a non-banking financial company

13)  Payment in cash or by way of a bank draft or pay order or banker’s cheque of an amount aggregating to more than Rs. 50,000 in a financial year for one or more pre-paid payment instruments, as defined in the policy guidelines for issuance and operation of pre-paid payment instruments issued by Reserve Bank of India under section 18 of the Payment and Settlement Systems Act, 2007 to a banking company or a co-operative bank or to any other company or institution.

14)  Payment of an amount aggregating to more than Rs. 50,000 in a financial year as life insurance premium to an insurer

15)  A contract for sale or purchase of securities (other than shares) for amount exceeding Rs. 1 lakh per transaction

16)  Sale or purchase, by any person, of shares of a company not listed in a recognised stock exchange for amount exceeding Rs. 1 lakh per transaction.

17)  Sale or purchase of any immovable property for an amount exceeding Rs. 10 lakh or valued by stamp valuation authority referred to in section 50C of the Act at an amount exceeding ten lakh rupees.

18)  Sale or purchase of goods or services of any nature other than those specified above for an amount exceeding Rs. 2 lakh per transaction.