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PAN Card Overview

Institution Issuing PAN Income Tax Department, Government of India PAN Customer Service Number 020 - 27218080 Birth of PAN Card 1972 Validity of PAN Card Long Term PAN Card Fee Rs. 66-1017 PAN Card Application Methods Online and Offline

What is a PAN card

Permanent Account Number (PAN) is a 10-digit alphanumeric identification number (both alphanumeric and numeric) issued to Indians, primarily to taxpayers. All the tax related information of a person is recorded in a PAN number which is the primary key for storing the information. No two persons or taxpaying enterprises can have the same PAN.

PAN is a unique 10-digit alphanumeric character and a PAN card is a physical or electronic card that contains PAN and other important information about an individual.

As per the new format of PAN cards introduced by the Income Tax Department of India on 1 January 2017, all PAN cards will contain a Quick Response (QR) code containing the cardholder's details. This code can also be used for data validation. It will also contain the name of the cardholder, father's name, date of birth and signature.

History of PAN card in India

Prior to the introduction of PAN cards by the Government of India, taxpayers are given a GIR number. However, this number is not unique at the national level. As a result, there is a greater risk of miscalculations and errors in the tax assessment process, as well as vulnerability to mistaken identity.

The concept of PAN was introduced by the Government of India in 1972 and made statutory under section 139A of the Income Tax Act, 1961.PAN was initially optional and was made mandatory for all taxpayers in 1976.

Structure of the PAN card

The PAN card contains information such as proof of identity and evidence of age and complies with Know Your Customer (KYC) rules. Below are the details of the PAN card:

Cardholder's personal/company name The name of the cardholder's father, for individual cardholders only. Date of Birth. Specify the date of birth of the cardholder in case of an individual and the date of incorporation in case of a company or business. PAN Number, which is a ten-character alphanumeric number, each character representing unique information about the cardholder. The first three letters are in strict alphabetical order and consist of three letters from A to Z. The PAN number is a 10-character alphanumeric number. The fourth letter reflects the category of the taxpayer.

Below are numerous entities and their corresponding characters:

A - Individual associations B - Groups of individuals C - Companies F - Enterprise G - Government H - Hindu Undivided Family L - Local authorities J - Legal persons P - Personal T - Trustee Association The fifth letter is the initial of the individual's surname. The remaining letters and characters are chosen at random. The first four characters are numbers and the last character is a letter. Personal Signature - The PAN card can also be used as a verification of a personal signature, which is essential for financial transactions. Personal Photograph - PAN can be used as evidence of visual identification of an individual. For companies and corporations, there is no portrait on the card.

PAN number format

Full name of the cardholder. The name of the cardholder's father. Pan Number Numeric: It has a 10-digit alphanumeric permanent account number. Signature of the cardholder. Date of Birth. Cardholder's photo. Hologram of the Government of India and the label of the Income Tax Department.

Types of PAN cards

Below are the different types of PAN cards issued to taxable entities in India:

Individuals, including minors and students Hindu Undivided Family (HUF) Company partnership Limited Liability Partnership (LLP) Trust societies Association of Persons (AOP) Body of Individuals (BOI) Foreigners

PAN Card Application Form

There are 3 types of PAN card applications, as shown below:

Form 49A - Indian Citizens (including Minors, Non-Residents of India, Citizens outside India, Indian Companies, Indian Enterprises and Indian BOIs/AOPs) who do not have a PAN card must fill in this form in order to obtain a PAN. Form 49AA - All foreign nationals requiring PAN must submit this form. Change or Correction in Existing PAN / Reprint of PAN Card - A person who already has an existing PAN but needs to make changes or corrections in his/her PAN card data must fill this form. However, those who want to reprint their existing PAN card without making any changes can apply for a reprint PAN card application.

PAN Card Eligibility

All Indian citizens and Non-Resident Indians (NRIs) are eligible to apply for a PAN card. All legal entities such as companies, corporations, members of associations, Hindu undivided families, etc. are also eligible to apply for a PAN card. However, all those who pay taxes in India and carry out financial transactions in India are required to have a PAN card.

The following entities are required to have a PAN card:

Individuals whose income exceeds the threshold of the income tax bracket. Individuals who earn taxable income for the benefit of others (e.g., income of minors). Individuals who have a profession or business and whose annual income or sales exceed Rs 500,000 per annum. Individuals registered under the General Sales Tax Act or the Central Sales Tax Act of a Union Territory or a State. Any person engaged in financial business which requires PAN card information. Section 139 requires charitable trusts to make a declaration (4A). Importers and exporters requiring import and export codes. Individuals who must pay excise tax. Individuals who are remunerated after deducting TDS. Individuals and their representatives are liable to pay service tax. Individuals who issue invoices under Rule 57AE.

Uses of the PAN card

When paying direct taxes, PAN must be reported. When filing income tax returns, taxpayers must provide their PAN. PAN information must be provided when registering a business. PAN information is required for many financial services.

Below are some of the financial services that have to submit their PAN card details:

Purchase or sale of property (immovable property) valued at Rs. 500,000 or more. Purchase or sale of vehicles other than two-wheelers. Payments to hotels and restaurants exceeding Rs. 25,000. Payments related to international travelling requirements. If the amount in this case is more than Rs. 25,000, the user must provide a PAN card. Payments with bank deposits exceeding Rs. 50,000. Purchase of bonds worth at least Rs. 50,000. Purchase of shares worth at least Rs. 50,000. Purchase of insurance policies of Rs. 50,000 or more. Invest in mutual funds. More than Rs. 5 lakhs were paid for jewellery and gold bars. Transfer of funds out of India. Transfer funds from NRE account to NRO account.

Benefits of the PAN Card

IT returns: all income tax eligible individuals and entities should file IT returns. the PAN card is a necessity for filing IT returns and is the main reason for individuals and other entities to apply for a PAN card. Proof of identity : PAN card is a valid proof of identity. PAN card is accepted as a proof of identity by all financial institutions and other organisations besides voter's card, Aadhaar card. Tax relief: One of the important reasons for obtaining a PAN card is to pay taxes. If an entity or an individual does not associate a PAN number with its bank account and the annual interest income on savings deposits exceeds Rs 10,000, then the bank will deduct TDS of 30% instead of 10%. Claiming Income Tax Refund: Very often, the TDS deducted from the income of a taxpayer is more than the actual tax he is supposed to pay. In order to claim the overpaid tax, the taxpayer has to link the PAN with his bank account. Starting a Business: In order to start a business, a company or any other entity has to register a PAN in the name of its entity, which requires a Tax Registration Number (TRN), which can be obtained only if the entity owns a PAN.

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