What is PAN Card ?

All taxpaying individuals and entities, Indians and non-resident Indians (NRIs), are allotted a unique identity number, known as the Permanent Account Number (PAN), by the Income Tax Department under the Income Tax Act, 1961. The PAN is a 10-digit alphanumeric number which is imprinted on a laminated plastic card known as the PAN Card. PAN card is an electronic system wherein all the tax related information of individuals & entities are recorded by the Income Tax Department, Govt. of India, under a single Permanent Account Number. No two taxpaying entities can have the same Permanent Account Number. A valid PAN Card serves as an important identity proof for any individual or entity which displays has all the vital details of the PAN holder. It is important to provide this identity proof when one is planning to engage in major financial transactions in India. Also, foreign passport holders and even minors can apply for a PAN card

Types of PAN Card

The Income Tax Department issues the PAN card to various taxpayers who are classified into various categories namely Individual, Hindu Undivided Family (HUF), Company, Partnership Firms, NGOs and Foreign Citizens or NRIs. The types of PAN card are explained in detail 

Income tax return filing is mandatory for a company and a firm. However, individuals, HUF, AOP, BOI are mandatorily required to file return of income if the income exceed basis exemption limit of Rs 2.5 lakhs. This limit is different for senior citizens and super senior citizens.

PAN card for individuals :

A PAN card allows individuals to track and link their financial transactions which help the IT department in calculating the total taxable amount for the individuals, on the basis of this data.

PAN card for companies :

A PAN card for entities looks similar to PAN card for individuals. However, the only exception is a lack of photograph on the physical PAN card. Also, instead of the date of birth which is displayed on PAN card for individuals, the registration date of companies/ organisation is mentioned on the physical card.

PAN for foreign citizens in India :

Foreign passport holders can also apply for a PAN card if they are looking undertake business or make investments in India. However, unlike resident Indians who must fill PAN Application Form 49A, NRIs and foreign citizens must fill and submit. For verification purpose, foreign citizen/NRI applicants can furnish their passport copy, copy of PIO card, Aadhar card issued by UIDAI, etc.

Who is eligible for PAN card?

Although anyone can apply for PAN card, it is a mandatory requirement for taxpaying individuals and entities. That is, all existing assessees, taxpayers or individuals who are eligible for filing their income tax returns, either on behalf of self or others, should get a PAN card. Any individual who is looking to engage in economic or financial transactions must quote the PAN. However, according to Section 160 of Income Tax Act, 1961, non-resident, minor, lunatic, idiot, and court of wards and such other persons can also get a PAN card through a Representative Assessee who will be responsible for making PAN card application. A new PAN card should be applied by any of the above mentioned individuals/ entities who have not applied for a PAN before or do not have the PAN allotted to them. 

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