Permanent Account Number (PAN) has become a very important tool to the Income Tax Department in tracking high value transactions and ensuring compliance with the tax laws.
Mentioning of PAN has become mandatory in many financial transactions, particularly in the following areas:
- Operating demat accounts
- Deposit of Rs 50,000 and above in the banks
- Investments in shares, mutual funds and post office savings in excess of Rs 50,000 each
- Sale or purchase of motor vehicles, excluding two wheelers
- Sale or purchase of immovable properties valued at Rs 5 lakhs and above
- Applying for a new telephone connection (landline or mobile)
- Payment of Rs 25,000 or more against hotel bills
Even if you may not fall under these categories you need to file Income Tax Return for which PAN is required.
Benefits of having a PAN card
If you have a PAN card, it can be used as a proof of your identity, particularly when you have to check-in on the basis of your air tickets purchased online.
You can check whether the taxes paid by you are updated in the database of the Income Tax Department.
Further you can now also verify whether your employer or the institution has indeed remitted to the Income Tax Department the tax deducted from the payments made to you.
Is it necessary to file Income Tax return if you have PAN?
Just because you have PAN, it is not necessary to file Income Tax Return. Income Tax Return needs to be filed only when you have taxable income or you need to claim refund of tax deducted by your employer or the institution making payments to you towards interest or professional services or commission or rent or winnings from lottery / game shows or horse races or contracts etc.
However, the converse is true: you need PAN to file an Income Tax Return.
How to get PAN?
It is very simple. You need to submit your details in Form No. 49A to any of the PAN Facilitation centers, located in all cities and major towns, wherever Income Tax offices are located.
The UTI Investors Services Ltd (UTIISL) and National Securities Depository Limited (NSDL) are the authorised agencies to accept and process PAN application forms.
You may also apply for PAN online through UTIISL's web site http://www.utiisl.co.in/pan/ or NSDL's web site http://tin.nsdl.com/.
It will normally take about 2 to 3 weeks to get your PAN card delivered at your doorstep.
If you need a PAN card urgently, you may also get Tatkal PAN by applying online using your credit card. You will get your PAN on priority basis and the same will be communicated to you through email.
The fees payable is only Rs 60 plus service tax presently @ 12.24 per cent, totaling Rs 67.
What are the details to be submitted for applying PAN?
Only very few details like the following need to be given in the case of individuals:
- Name including your other names, if any
- Father's name to be given even in the case of married women
- Date of birth
- Address both official and residential
- Main source of your income salary or professional/business or any other income
- Designation and code of your assessing officer. You may obtain this information from the facilitation centers of UTIISL or NSDL or from the web site of the income Tax Department at http://incometaxindia.gov.in/ao/Firstlevel.asp
You need to submit the following documents along with your application:
- Proof of identity
- Proof of address
- A recent colour photograph (3.5 cm X 2.5 cm)
You may submit copies of your passport/credit card/bank statement/voter's identity card/depository account/driving license/ration card/property tax assessment order to establish proof of identity and address. In addition, there are number of other documents like school leaving certificate/matriculation certificate/degree of a recognised educational institution/water bill for proof of identity.
Likewise, you may use electricity bill/telephone bill/employer certificate/rent receipt for proof of address. Even if you don't have any of these documents, you may obtain a certificate of identity and/or address signed by a MP or MLA or a Municipal Councilor or a Gazette Officer.
How can I obtain PAN if I don't stay in India?
Non-Resident Indians may obtain PAN by applying through their representative assessee, who has to be an individual residing in India.
Recently, non-residents are permitted to apply for PAN by giving their present address, even though it is not in India. In such a case, the non-resident individual has to submit copy of passport for proof of identity and address and bank statement for proof of address (if the address mentioned in the passport is different from the present address).
In the case of non-residents, who are foreign citizens, these documents will have to be attested by the Indian embassy in their country. Detailed guidelines are available at the web site http://tin.nsdl.com/downloads/AdditionalguidelinesNRPAN_newPAN.pdf.
Other issues related to PAN
A person can have only one PAN and duplicate PANs, if any, must be surrendered. It is illegal to have duplicate PANs.
Even if a PAN is obtained from one place, return of income can be submitted at a different place, in case of change of address or jurisdiction.
If you wish to correct the particulars given in the PAN, you may submit an application for making modifications in the PAN. This will ensure that the information in the database of the Income Tax Department is updated.
For additional information and FAQs, you may visit the following web site:
http://incometaxindia.gov.in/PAN/Overview.asp
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