Why to have a PAN Card?

Why to have a PAN Card?

IT PAN Card has become necessary in financial transactions of Rs 50000/- and above.pan mustIT PAN Card has been one of the approved ‘Proofs of Identity’ /PoI in many places where a proof of identity is required.pan-card-detailsWhy,at all, you should have a PAN Card?!

If your income exceeds the basic exemption limit, you should apply for PAN OR PERMANENT ACCOUNT NUMBER from the Income Tax Department, by May 31st of the relevant assessment year. Any person whose turnover or gross receipts exceed Rs.5 Lacs and specified charitable trusts should apply for “PAN” before the end of the accounting year. Employers filing returns for fringe benefits have no time limit set to apply for PAN.

Importers, Eporters and those applying for registration under the Central Excise Rules, 1944, Service Tax Rules, 1994, Central Sales Tax Act or the State Sales Tax law also have to apply for the PAN.

Using PAN. All returns, quarterly statements, challans or correspondence with the income tax authorities should include the PAN. The IT PAN must/may be used in the following transactions:-

  • Sale or purchase of immovable property valued at Rs 500,000 or more. If there are co-owners (buyer or seller), the PAN of all the owners must be mentioned. If a nominee holds the property, the PAN of the legal owner must be mentioned.
  • The PAN should be given in the document pertaining to purchase or sale of the property.
  • Sale or purchase of a motor vehicle requiring registration other than two-wheelers. This does not include vehicles running on fixed rails or special vehicles for use only in factories or in other enclosed premises or vehicles of less than four wheels with engine capacity of not more than 25 cc.
  • A Term deposit of more than Rs 50,000 with any banking company and deposit of more than Rs 50,000 with post-office savings bank. This requirement is not mandatory when investing in post-office National Savings Certificate or Kisan Vikas Patra, and the PAN will be required only if the time deposit exceeds Rs 50,000.
  • Contract of sale or purchase of securities exceeding Rs 1 lakh in value, including shares, bonds, debentures, derivatives, units and government securities.
  • Cash payment of Rs 50,000 or more for purchase of bank drafts, pay orders or bankers cheques during any one day.
  • Cash payment exceeding Rs 25,000 in connection with travel to any foreign country (fare or purchase of foreign currency).
  • Application for installation of telephone, including cellular telephone.
  • Payment to hotels and restaurants against bills exceeding Rs 25,000 at any one time.
  • Application for issue of a credit card. A cash deposit of Rs 50,000 or more with any bank during any one day. Payment of Rs 50,000 or more to a mutual fund for purchase of units or to a company for acquiring its shares or to a company/institution for acquiring its debentures/bonds or to RBI for acquiring bonds.
  • Minor intending to open time deposit or bank account should quote the PAN of either father or mother or guardian in whose hands income is likely to be clubbed.
  • In booking train tickets online(e tickets) for identity.

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