PAN Card number or Permanent Account Number
What is PAN card number ?
PAN stands for Permanent Account Number. PAN is a ten-digit unique alphanumeric number issued by the Income Tax Department. PAN is issued in the form of a laminated plastic card (commonly known as PAN card). Given below is an illustrative PAN:
Who is required to have PAN card number ?
PAN is to be obtained by following persons:
- Every person if his total income or the total income of any other person in respect of which he is assessable during the previous year exceeds the maximum amount which is not chargeable to tax.
- A charitable trust who is required to furnish return under Section 139(4A)
- Every person who is carrying on any business or profession whose total sale, turnover, or gross receipts are or is likely to exceed five lakh rupees in any previous year
- Every importer/exporter who is required to obtain Import Export code
- Every person who is entitled to receive any sum/income after deduction of tax at source
- Any person who is liable to pay excise duty or a producer or manufacturer of excisable goods or a registered person of a private warehouse in which excisable goods are stored and an authorized agent of such person
- Persons who issue invoices under Rule 57AE requiring registration under Central Excise Rules, 1944
- A person who is liable to pay the service tax and his agent
- Persons registered under the Central Sales Tax Act or the general sales tax law of the relevant state or union territory
- Every person who intends to enter into specified financial transactions in which quoting of PAN is mandatory
A person not covered in any of the above can voluntarily apply for PAN.
What is the use of PAN card number ?
PAN enables the department to link all transactions of the assessee with the department. These transactions include tax payments, TDS/TCS credits, returns of income, specified transactions, correspondence and so on. It facilitates easy retrieval of information of assessee and matching of various investments, borrowings and other business activities of assessee.
A Permanent Account Number has been made compulsory for every transaction with the Income-tax Department. It is also mandatory for numerous other financial transactions such as opening of bank accounts, availing of institutional financial credits, purchase of high-end consumer items, foreign travel, transaction of immovable properties, dealing in securities, etc. A PAN card is a valuable means of photo identification accepted by all Government and non-Government institutions in the country.
It is mandatory to quote PAN on the return of income. Apart from return of income, PAN is also to be quoted in all challans for making payment of tax, correspondence with the Income Tax Department, etc.
what is the significance different letters used in PAN Card number ?
PAN is a ten-digit unique alphanumeric number issued by the Income Tax Department. The formation of PAN is discussed below :
- Out of the first five characters, the first three characters represent the alphabetic series running from AAA to ZZZ. (E.g. ALWPG5809L).
- The fourth character of PAN represents the status of the PAN holder (E.g. ALWPG5809L). “A” stands for Association of Persons (AOP)
“A” stands for Association of Persons (AoP)
“B” stands for Body of Individuals (BOI)”C” stands for Company
“E” stands for Limited Liability Partnership
“F” stands for Firm
“G” stands for Government Agency
“H” stands for Hindu Undivided Family (HUF)
“J” stands for Artificial Juridical Person
“L” stands for Local Authority
“P” stands for Individual
“T” stands for Trust
- Fifth character of PAN represents the first character of the PAN holder’s last name/surname in case of an individual. In case of non-individual PAN holders fifth character represents the first character of PAN holder’s name (E.g. ALWPG5809L)
- Next four characters are sequential numbers running from 0001 to 9999 (E.g. ALWPG5809L).
- Last character, i.e., the tenth character is an alphabetic check digit (E.g. ALWPG5809L).The combination of all the above items gives the PAN its unique identity.
How the Income tax department ensure that the person quote PAN Card number ?
It is statutory responsibility of a person receiving document relating to economic or financial transactions notified by the Central Board of Direct Taxes (CBDT) to ensure that PAN has been duly quoted in the documents in which quoting of PAN is mandatory. Thus, the receiver of these documents will ensure that PAN is quoted in the respective document. E.g. PAN is necessary to open a bank account and hence the Bank will ensure that the applicant has quoted his PAN at the time of applying for bank account.
How to apply PAN Card number ?
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What are the documents required to apply for PAN Card number ?
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what is the procedure to apply duplicate PAN Card number ?
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Source ; Incometaxindia.gov.in