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After the Aadhaar Card, PAN (Permanent Account Number) card is another essential document for every citizen of India. Whether starting a business, opening a bank account, or filing taxes, having a PAN card is important.
In this article, we have covered every aspect that you need to know about the PAN card, starting from its application process to its importance and usage.
The Permanent Account Number (PAN) card is a physical card that consists of a 10-digit unique number formed by the combination of alphabets and numbers, name, date of birth, and photograph.
This card is issued by the Income Tax Department of India and helps to track financial transactions and ensures transparency in the taxation system.
PAN Card is used for various purposes, including:
One of the primary reasons to have a PAN card is that it is mandatory for filing income tax returns (ITR) in India. Whether you are an individual, a firm, or a business entity, your PAN is required to file your ITR. This helps the government track and monitor tax payments and ensures that everyone is complying with tax laws.
Banks in India require you to submit your PAN card when opening a savings or current account. This helps banks keep track of financial transactions and report any large or suspicious transactions to the Income Tax Department. It also helps in curbing money laundering activities.
A PAN card is mandatory for any high-value transactions. For instance:
For salaried individuals, your employer will need your PAN to deduct TDS (Tax Deducted at Source) from your salary. Similarly, professionals, freelancers, or consultants receiving fees must provide their PAN for TDS purposes.
A PAN card also serves as a valid proof of identity across India. It is accepted by various government and private institutions as a reliable document to verify an individual’s identity.
For business owners and MSMEs, having a PAN is essential for buying or selling goods and services beyond a certain limit. It is mandatory for obtaining GST registration, which is a prerequisite for trading in goods and services.
If you are planning to travel abroad and need to convert Indian currency to foreign currency, you will be required to provide your PAN for transactions above ₹50,000. This is also applicable when making foreign remittances.
When applying for a loan or credit card, financial institutions require your PAN card. This helps them assess your financial standing and creditworthiness.
Applying for a PAN Card is an easy process, and you can apply through online and offline mode.
Follow the below steps, to apply for PAN Card online:
If you are planning to apply for a PAN Card offline, then you can follow the below steps:
Whether you are applying for a PAN card through online or offline mode, you should keep the following documents ready for a smooth process:
Identity proof
Address proof
Birth certificate
The fees for PAN Card application including GST depend on the option you selected for dispatching your PAN Card. It includes:
| PAN application submitted through any mode | PAN application is submitted online |
|---|---|
| Dispatch of the physical card in India - Rs 107 | Dispatch of the physical card in India - Rs 101 |
| Dispatch of the physical card outside India - Rs 1017 | Dispatch of the physical card outside India - Rs 1011 |
| Dispatch of e-PAN card to email - Rs 72 | Dispatch of e-PAN card to email - Rs 66 |
The government of India has made it mandatory to link your PAN card with Aadhaar. However, linking PAN card can be done easily by following the below steps:
If you need to update any information on your PAN card or by mistake some error has been made like spelling mistakes or incorrect date of birth, you can request for updation. Here’s how you can do that:
To further elaborate the importance of a PAN card, here are some common scenarios where it plays a crucial role:
If you’re an entrepreneur looking to start a business, one of the first documents you’ll need is a PAN card. It is required for registering your business and opening a business bank account. Additionally, PAN is essential for filing taxes and fulfilling other compliance requirements.
Whether you’re investing in mutual funds, the stock market, or fixed deposits, a PAN card is mandatory. This ensures that your investments are linked to your PAN, making it easier for the government to track your financial activities and tax obligations.
When buying or selling property, a PAN card is mandatory if the transaction value exceeds ₹10 lakhs. This helps the government keep track of high-value transactions and curb black money.
Even if your income is below the taxable limit, filing an income tax return (ITR) can be beneficial, especially if you’re applying for loans or visas. Your PAN is required to file an ITR, which serves as proof of your financial history.
If you are receiving a payment above ₹2 lakhs, such as from the sale of goods or services, the payer is required to collect your PAN. This is also applicable to large cash deposits and withdrawals from your bank account.
When applying for a passport, your PAN card can be used as one of the identity proofs. It ensures that all your financial transactions are correctly reported and linked to your identity.
Buying jewellery worth more than ₹5 lakhs requires you to provide your PAN card. This is another measure by the government to monitor large financial transactions and prevent tax evasion.
Yes, NRIs can apply for a PAN card by providing a copy of their passport as proof of identity and a foreign address as proof of address.
It usually takes about 15 working days for your PAN card to be processed and delivered.
In case you lose your PAN card, you can apply for a reprint by visiting the official NSDL or UTIITSL website, paying the reprint fee, and submitting the necessary documents.
No, holding more than one PAN card is illegal and can attract penalties.
Yes, if you conduct a high-value transaction without submitting a PAN card, the Income Tax Department can charge a fine of Rs 10,000.
An e-PAN is a digitally signed PAN card issued in electronic format. It has the same validity as a physical PAN card and can be downloaded from the Income Tax Department’s website. It is particularly useful for those who need PAN quickly for online transactions.
Yes, as per current regulations, linking your PAN with Aadhaar is mandatory. The deadline for linking changes, so it’s important to stay updated to avoid any penalties.
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