What is a PAN card number and whether we actually need it or not. What are the benefits of having PAN CARD?? If you remember, during demonetization PAN was mandatory in order to exchange old notes with new currency. And PAN CARD is mandatory to file Income Tax Return.
Lets know about PAN CARD.
1) PAN CARD (Permanent Account Number) is a ten-digit unique alphanumeric number in the form of a laminated card issued by the Income Tax Department.
2) Unique Identity : Each PAN CARD has its unique identity.
Break up of 10 digit unique alphanumeric PAN :
The first 3 characters of PAN represents the alphabetic series running from AAA to ZZZ. The 4th character of PAN represents the status of the PAN holder.
e.g. – If 4th character of PAN CARD is ” P “.
” P ” stands for Individual.
C – Company, E – LLP . F – Firm. G – Government Agency. H – HUF.
J – Artificial Juridical Person. T – Trust. L – stands for Local Authority.
In case of an individual, 5th character of PAN CARD represents the first character of the PAN holder`s last name.
In case of non-individual PAN holders, 5th character of PAN CARD represents the first character of PAN holder’s name.
Next 4 characters are sequential numbers running from 0001 to 9999 .
Last character, i.e., the 10th character is an alphabetic check digit.
3)Utility : PAN Number helps Income tax department to link and track transactions of the assessee like tax payments, TDS credits and so on. It facilitates easy retrieval of information of assessee and matching of various financial and business activities of assessee.
4) Benefit : PAN number has been made compulsory for many financial transactions. Example – opening of bank accounts, opening of demat account, Cash deposits more than Rs.50,000 in bank account, transactions of immovable properties etc. It is mandatory to quote PAN number on Income Tax Return and also at the time of payment of income tax. A PAN card is a valuable means of photo identification accepted by all Government and non-Government institutions in the country.
5) PAN Number obtained once is valid for life-time of the PAN-holder throughout India. You may change the details of PAN with proper documentation. It can not be surrendered and also does not require renewal.
6) A person cannot hold more than one PAN CARD.A penalty of Rs. 10,000/- is liable to be imposed under Section 272B of the Income-tax Act, 1961 for having more than one PAN.If a person holds more than one PAN then he or she must immediately surrender the additional PAN card(s).
7) Remember, Having PAN does not mean, you must file Income Tax Return. Filling of Income Tax Return is mandatory only if you are liable to file return of income under section 139.
If still You do not have PAN CARD, just apply for it now. its online, inexpensive and most importantly It is very useful.
Please comment below if Any query or doubt related to this post.