PAN (Permanent Account Number) is a ten-digit alphanumeric number, e.g. AAAAA0000A, issued by the Income Tax Department of India in the form of a laminated card to any “person” who applies for it or is allowed the number by the department. without an application.
Table of Contents:
Procedure for PAN Application :
- Online application for PAN can be done on NSDL or UTIITSL website.
- Submit PAN card Application Form 49A available at NSDL.
- The application fee can be paid by credit/debit card, money order or online banking.
- Once the application and payment are approved, the applicant must send supporting documents by courier/post to NSDL.
- After receiving the documents, NSDL will process the PAN application and PAN will be issued.
Types of PAN Applications :
1) Application for allotment of PAN (Form 49 A) :
This application should be used when the applicant has never applied for a PAN or does not have PAN allotted to him.
2) ‘Request for New PAN Card or/and Changes or Correction in PAN data’ :
This application should be used when PAN has been allotted already to applicant but a new PAN card is required or when data associated with the PAN (e.g. name of applicant / date of birth / address) is required to be updated in the records of Income Tax Department.
3) Application for allotment of PAN (Form 49AA) – applicable for foreign citizens :
This form should be used when the applicant has never applied for a PAN or does not have PAN allotted to him. An applicant can visit Income Tax Department (ITD) website to find whether a PAN has been allotted to him or not.
Documents Required for PAN Application :
1. Identification Proof (Any One) :
- The Aadhaar card.
- Voter ID Card.
- Passport.
- The drivers license.
- Ration card featuring a picture.
- An official government-issued photo ID card.
2. Identification of Address (Any One) :
- The Aadhaar card.
- Voter ID Card. Passport.
- Drivers license.
- Utility bills that are no more than three months old (electricity water and landline).
- A bank account statement or passbook.
- Credit Card Statement.
- The certificate of domicile.
3. A Proof of Birth Date (Any One) :
- The birth certificate.
- The Matriculation Certificate.
- Passport.
- The drivers license.
- Aadhar card.
- The Pension Payment Order.
4. The steps for an online application :
- Go to the website of UTIITSL or NSDL.
- Choose the proper form (Form 49AA for foreign nationals Form 49A for Indian citizens).
- Complete all fields with precision.
- Scan copies of your identification address and birthdate should be uploaded.
- Online application fee payment (Rs. 110 for addresses in India and Rs. 1020 for addresses outside of India).
- Finish the form and make a note of the tracking number for your records.
- Documents should be sent in hard copy if necessary.
5. Steps for Offline Applications :
- Acquire Form 49A or Form 49AA.
- Use BLACK ink to complete the form in BLOCK LETTERS.
- Enclose photocopies of your proof of address identity and birthdate.
- The application fee can be paid at the submission center or by demand draft.
- Deliver the form and supporting documentation to a PAN or TIN-FC center.
- Obtain a tracking acknowledgment slip.
6. After Submission :
- Utilize the acknowledgment number to monitor the application status on the UTIITSL or NSDL website.
- Until you receive the PAN card hold onto a copy of the acknowledgment receipt.
- Verify that all the information is correct and corresponds with the attachments.
- Check the form one more time before submitting it.
- For your records retain copies of all submitted paperwork.
Eligibility Criteria for a PAN Card :
To get a PAN Card which is a one step process in India, the applicant has to be an Indian resident and be an Indian citizen. The requirements to qualify for a PAN Card are as follows:.
- Individuals: Indian people living in India. Descendants of the Indian diaspora who live outside the country. People from foreign countries who have come to India and are living here. Firms, and Companies.
- Organizations or firms with Indian registration.
- Organizations Societes and Trusts. Corporations companies and trusts that are registered in India.
- Minor individuals: The parents or guardians have to fill out an application for the minor’s PAN card.
Benefits of PAN :
Tax deductions :
A PAN card is essential for taxation purposes. If an individual or entity has not linked the bank account with Permanent Account Number and the yearly interest income on the savings account exceeds Rs. 10,000, the bank will subtract 30 percent TDS (not 10 percent).
Business registration :
While establishing an entity, for example, a firm or a company, you will require a PAN card. It helps a business to obtain a Tax Registration Number (TRN).
Filing for a tax refund :
Often, a TDS deduction from an individual’s income exceeds the actual TDS amount that he/she is supposed to give. For claiming the extra tax paid, people need to have their bank accounts linked with PAN.
Demat account :
A Permanent Account Number is mandatory for opening a Demat account. Such an account holds stocks in electronic form.
Restaurant and hotel bills :
A PAN card is required for restaurant or hotel bills of above Rs. 50,000.
Selling or buying of goods :
Furnishing PAN is vital for the sale or purchase of goods or services worth above Rs. 2 lakh.
Banker’s cheque, pay order, and bank draft :
A PAN card is essential for transactions exceeding Rs. 50,000 via banker’s cheque/pay order/bank draft.
Compliance for PAN Card :
When you are dealing with PAN regulations, one must quote it correctly on all financial papers and transactions; it must also be its driving force in connecting with Aadhaar. If PAN is used solely to classify personal income tax returns at the time of filing, keep it up to date, and, if there are any other changes in personal data, one should be sure to renew it. As far as high-value transactions and business-related documents are concerned, be sure to use your PAN only. Having just one PAN and willingly giving up on extra copies is very important. Be responsive to all the correspondence issued by the Income Tax Department and always adhere to the requirements imposed by Tax Deducted at Source (TDS) and Tax Collected at Source (TCS) regulations by providing your PAN. Therefore, you will ascertain the compliance and evade the penalties.
Penalties for Non- Compliance :
Failure to Quote PAN:
Under Section 272B of the Income Tax Act a penalty of Rs. 10000 may be assessed if you fail to quote PAN in particular transactions as instructed.
Inaccurate PAN:
There is a 10000 rupee fine for mentioning an incorrect PAN.
Many PANs:
It is strongly discouraged to have more than one PAN because you may be penalized.
The checklist will enable you to countervailed with all required reports and as a result be fully compliant with PAN laws including the elimination of fines or legal issues and preventive detention.
Conclusion :
To sum up getting a PAN card is critical because it guarantees that tax laws are followed makes financial transactions easier by precisely identifying people and is a vital link between financial activities and the Income Tax Department. It also encourages accountability and openness in financial transactions making it a necessary prerequisite for people and organizations involved in a range of Indian economic activities.
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