1.  What is PAN?

Permanent Account Number (PAN) is unique Identity number issued by the Income Tax Department under the provision of Income Tax Act, 1961. Each assessee (e.g. individual, firm, company etc.) is issued a unique PAN.

2.      Who must have a PAN Card?

It is mandatory to quote PAN in return of Income & during all correspondence with the Income-tax authorities. Persons filing their income tax returns or whose total assessable income during the previous year exceeds the maximum amount which is not chargeable to tax must have PAN.

a)      Person carrying business or profession whose total sales or gross receipts exceeds Rs. 500,000 in any previous year.

b)      For any investment in India and for one who wants to carry out any transaction in Indian Stock Markets.

c)      It is now compulsory to quote PAN in all documents pertaining to financial transactions notified from time to time, such as:

It is mandatory to quote PAN in the following circumstances:

• Opening a Bank Account in India including Demat & Trading Account
• Getting a credit card
• Sale or purchase of any property in India
• Sale of purchase of any motor vehicle
• Bank deposits exceeding Rs.50, 000
• Purchase of securities greater than Rs.1,00,000
• Demand Drafts exceeding Rs.50,000
• Cheque deposits exceeding Rs.50,000
• For obtaining a telephone or cellular telephone connection.
• From April 1, 2010, any person whose tax has to be deducted at source, does not have a PAN shall be liable for TDS at a minimum 20% rate irrespective of his nature of income.

3.      What documents and information have to be submitted along with the application of pan card or with the Form 49A?

• Individual applicants will have to affix one recent, coloured photograph (Stamp Size)
• Any one document as proof of ‘Identity’ and ‘Address’;
• Designation and code of the concerned Assessing Officer of Income Tax Department will have to be mentioned.

4.      Which documents will serve as proof of ‘Identity’ regarding pan card application?

Any of the following documents will be served as a proof of Identity.

• Copy of school leaving certificate or matriculation certificate
  or degree of a recognized educational institution
• Copy of depository account statement
• Copy of credit card or bank account statement
• Copy of water bill or ration card
• Copy of property tax assessment order
• Copy of passport or voter identity card
• Copy of driving license;

In case the PAN applicant is a minor, any of above documents of any of the parents or guardian of such minor shall serve as proof of Identity; In case PAN application is made on behalf of a HUF, any of above documents in respect of Karta of the HUF will serve as proof of Identity.

5.      Which documents are required for pan card application as proof of ‘Address’?
Any of the following documents will be served as an address proof.

• Copy of electricity bill or telephone bill
• Copy of depository account or credit card or bank account statement
• Copy of ration card or employer certificate
• Copy of passport or voter identity card
• Copy of property tax assessment order or driving license or rent receipt

In case the PAN applicant is a minor, any of above documents of any of the parents or guardian of such minor shall serve as proof of Address;
In case PAN application is made on behalf of a HUF, any of above documents in respect of Karta of the HUF will serve as proof of Address.

6.      Can you have more than one PAN Card?

Obtaining/possessing more than one PAN is against the law and may attract a penalty upto Rs.10,000. Every person is required to hold only one PAN Card.

7.      What should you do if you are having more than one PAN?

Having more than one PAN is offence under the law, so you should surrender the other PAN card, if any.

8.      What, if you loose your PAN card?

You can reapply for the duplicate PAN and can get the same number.

9.      Do you have to apply for PAN again in case of change of residence?

PAN is a permanent number and remains the same lifelong. You do not have to apply for a new PAN in case of change of residence.

Quote your PAN correctly in all your documents, putting wrong PAN may create troublesome situation.

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Alok Patnia

Founder and Director at Taxmantra.com