What is PAN Card?
PAN stands for ‘Permanent Account Number’. It is a 10 digit alphanumeric number and that is issued in the form of laminated plastic card by the Income Tax department under the Indian Income Tax Act, 1961. This number is issued under the supervision of the Central Board of Direct Tax (CBDT).
PAN is a code that acts as an identification number for individuals, families and Corporates who pays income tax. This number is unique for everyone across the country.
The most important point about PAN Card is that it does not affect by a change of address.
Why is it important to have a PAN Card?
Now a days PAN is mandatory for various financial transactions like opening up of bank account, filing ITR, sale or purchase of valuable assets above certain limit, purchase of foreign currency etc. It is very useful to prevent tax evasion by tracking the monetary transactions, especially of high-net-worth individuals.
Few important financial transactions are following:
- Buy & sell of immovable property valued above Rs. Five Lakh.
- For time deposit more than Rs. 50, 000/- in bank account and post office saving account, both.
- Buy & Sell of securities more than the value of Rs. 1 Lakh.
- To pay the bills of hotels and restaurant.
- To deposit cash amount more than Rs. 50, 000/- in bank account during one day.
What is the structure of PAN?
- PAN is a 10 digit alphanumeric code, for example: BBBLP1234D.
- First five characters are letters, next four are numerical, and last one is a letter.
- The first three letters are sequence of alphabets from A to Z.
- Fourth letter signifies the type of holder of the card.
Each holder is uniquely defined as following:
A – Association of Persons (AOP)
B – Body of Individuals (BOI)
C – Company
F – Firm
G – Government
H – HUF (Hindu Undivided Family)
L – Local Authority
J – Artificial Judicial Person
P – Individual
T – Trust (AOP)
K – Krish (Trust Krish)
Fifth character of the PAN is the first character of the following:
Of the surname or last name of the person or
Of the name of the entity.
The last character is an alphabetic letter.
In case PAN is issued by NSDL, date of issue of the PAN also mentioned at the right hand top corner above the photo on the PAN card. If PAN is issued by UTI – TSL date of issue will not be mentioned.
Who must keep the PAN card?
Every individual who is required to file the ITR.
Any professional or a business person whose total sales or turnover exceeds the limit of Rs. 5 Lakh.
Any person who regularly deals in any kind of financial transactions where PAN is mandatory.
How to obtain a PAN Card?
These days you can apply online for PAN. You have to follow certain steps and submit the required documents related to your personal information. Then you will have to send the acknowledgement receipt at office address of National Securities Depository Ltd. (NSDL) or UTI Infrastructure Technology Ltd. These two are authorized agencies, recognized by the Income Tax Department to facilitate the PAN applications.
Form 49A is the most important form to apply for PAN card, so you must know few important things before filling up the form 49A:
- At the time of filling your application form, you will have to fill your surname before your first name.
- As it is an online process you will have to go through the e-KYC and e-Sign facility, so here your Aadhaar card will be used to get all your personal information. So you don’t have to upload your photo, signature and other documents separately, your Aadhaar photograph will appear on your PAN card.
- And in case if you follow the standalone e-sign facility than you will be required to upload your photograph, signature and other supported documents in a prescribed format.
- One more important thing, to use the e-KYC and e-sign facility your mobile number or email id should link with your Aadhaar card, because it is important for Aadhaar authentication process.
- For minor applicants e-KYC and e-sign facility is not allowed.
What is the step – by – step process to apply for PAN via NSDL portal using e-sign method?
- First visit the following NSDL website
- Click on the option ‘Application Type’ then select the appropriate application form like 49A for resident individual and Form 49AA for non-resident individuals (NRIs) and foreign resident individuals.
- Select the category.
- Fill the required information asked there, like your Name, date of Birth etc. all the compulsory options are marked with asterisk sign those you must fill.
- After filling all the information, click on the ‘Submit Button’. As you submit your information a token number will be generated, now click on the given link to continue the process.(You can take a screenshot of your token number just in case you don’t get it on your email due to some technical complications.)
- Now you will be proceeding to a new page. There you will see three options: (i) Submit digitally through e-KYC and e-sign (ii) submit scanned images through e-sign and (iii) Forward application documents physically.
- Now you have to enter your details about Aadhaar number, parents name etc. here you can choose the option either Father’s Name or Mother’s Name to get printed on the PAN Card.
- After filling the entire relevant information click on “Next”, then new page will appear asking you to fill additional personal details like Source of income, address and contact details. And click on “Next”
- Here you will have to enter your ‘area code’, AO type (Assessing Officer), range code, and AO number. And click on “Next”
- This is the last step, here you will be asked to choose and upload the supporting documents along with your photograph and signature.
Once your documents and signature is uploaded you will be asked to make the payment of Rs. 115.90.
In case you have chosen to send your documents physically instead of paperless facility you will have to pay just Rs. 110.
Once the payment process is done, there is an Aadhaar authentication process, an OTP will be sent to your mobile or on your email id whichever is linked to your Aadhaar.
Once the Aadhaar authentication process is done successfully, you can take the print out of the receipt of 15 digit unique acknowledgement number, sign it and post it to the NSDL office.
Suppose, your Aadhaar authentication has been failed, take the print out of acknowledgement receipt, paste your photographs, sign the receipt and attach the photocopy of your documents uploaded by you send it across to the NSDL office.
You can track the status of your application on the following link:
https:// tin.tin.nsdl.com/pantan/Status Track.html