Faq's
1. What is a PAN card? Ans:
Ans.
Permanent Account Number (PAN) is a ten-digit alphanumeric number, issued in the form of a laminated card, by the Income Tax Department, to any “person” who applies for it or to whom the department allots the number without an application. PAN enables the department to link all transactions of the “person” with the department. These transactions include tax payments, TDS/TCS credits, returns of income/wealth/gift/FBT, specified transactions, correspondence, and so on. PAN, thus, acts as an identifier for the “person” with the tax department.
PAN was introduced to facilitates linking of various documents, including payment of taxes, assessment, tax demand, tax arrears etc. relating to an assessee, to facilitate easy retrieval of information and to facilitate matching of information relating to investment, raising of loans and other business activities of taxpayers collected through various sources, both internal as well as external, for detecting and combating tax evasion and widening of tax base.
A typical PAN is AFZPK7190K.
First three characters i.e. “AFZ” in the above PAN are alphabetic series running from AAA to ZZZ.
Fifth character i.e. “K” in the above PAN represents first character of the PAN holder’s last name/surname.
Last character i.e. “K” in the above PAN is an alphabetic check digit.
2. Why is it necessary to have pan? Ans:
Ans.
It is mandatory to quote PAN on return of income, all correspondence with any income tax authority. Since 1 January 2005 it has become mandatory to quote PAN on challans for any payments due to Income Tax Department.
It is also compulsory to quote PAN in all documents pertaining to the following financial transactions-
- Sale or purchase of any immovable property valued at five lakh rupees or more;
- Sale or purchase of a motor vehicle or vehicle, the sale or purchase of a motor Vehicle or vehicle does not include two wheeled vehicles, inclusive of any detachable side-car having an extra wheel, attached to the motor vehicle
- A time deposit, exceeding fifty thousand rupees, with a banking company ;
- A deposit, exceeding fifty thousand rupees, in any account with Post Office Savings Bank;
- A contract of a value exceeding one lakh rupees for sale or purchase of securities
- Opening Bank Account
- Making an application for installation of a telephone connection (including a cellular telephone connection)
- Payment to hotels and restaurants against their bills for an amount exceeding twenty-five thousand rupees at any one time ;
- Payment in cash for purchase of bank drafts or pay orders or banker’s cheques for an amount aggregating fifty thousand rupees or more during any one day;
- Deposit in cash aggregating fifty thousand rupees or more with a bank during any one day;
- Payment in cash in connection with travel to any foreign country of an amount exceeding twenty-five thousand rupees at any one time.
3. How does Income Tax Department ensure that PAN is quoted on transactions mentioned above? Ans:
Ans.
It is statutory responsibility of a person receiving document relating to economic or financial transactions notified by the CBDT to ensure that PAN has been duly quoted in the document.
4. Can an application for PAN be made through Internet? Ans:
Ans.
Yes, application for fresh allotment of PAN can be made through Internet. Further, requests for changes or correction in PAN data or request for reprint of PAN card (for an existing PAN) may also be made through Internet.
Applypanonline.com helps you to apply for PAN Card in a few easy and convenient steps. The services rendered include verifying, supporting and filing the application forms for those who are applying for new PAN card, corrections and changes to their existing PAN data and request for duplicate or replacement of lost or damaged PAN card.