PAN CARD - DEFINITION, CONSTITUTION AND CONSTRUCTION
Permanent Account Number is called PAN. PAN CARD stands
for
Permanent Account Number Card which contains a unique
10 digit number provided to
individuals or companies by the Income Tax Department of the Government of India. In no case, two individuals
can
have identical PAN and also an individual can have more than one PAN. The PAN
is unique, national, and permanent one. It is unaffected by
a change of address, even between states.
PAN was introduced
to
facilitate 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.
PAN Card is mandatory for opening of Bank Account, sale or
purchase of assets above the specified limits, to apply for registration for any business or industrial or Service Sector activities etc., It will be very
useful to give identity proof of individuals.
The Permanent Account Number i.e. PAN is a permanent one.
If a PAN Card, is lost/stolen/changes to be made/correction to
be carried out in PAN Data, on submission of an application form
namely “Request for new PAN Card/And changes or correction in PAN
Data”
and
a new PAN card will be issued but the PAN (Permanent Account Number) Card will still remain the same.
WHY IS IT NECESSARY TO HAVE PAN?
It is
mandatory to
quote
PAN
on return of
income, all
correspondence
with any income tax authority. From 1st January,
2005 it is 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:-
(a) sale or purchase of any immovable property valued at five
lakh rupees or more;
(b) 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;]
(c) a time deposit, exceeding fifty thousand rupees, with a
banking company ;
(d) a deposit,
exceeding fifty thousand rupees, in any
account with Post Office Savings Bank;
(e) a contract of a value exceeding one lakh rupees for sale or
purchase of securities;
(f) opening a bank account;
(g) making an application
for installation of
a telephone
connection (including a cellular telephone connection);
(h) payment to hotels and restaurants against their bills for an amount exceeding twenty-five
thousand rupees at any one
time ;
(i) 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;
(j) deposit in cash aggregating fifty thousand rupees or more
with
a bank during any one day;
(k) payment in cash in connection with travel to any foreign
country
of
an amount exceeding
twenty-five
thousand
rupees at any one time.
(i)
From
19.4.2010 every dealer who applies for registration
under the Tamil
Nadu Value Added Tax Act,
2006
shall
obtain Permanent Account Number (PAN) and furnish it to
the
Registering Authority at the time of
submission
of the
application along with the proof of the same].
At
the time of introduction of Goods and Services Tax the Goods and Services
Taxpayer Identification Number i.e. GSTIN the structure will be as follows.
15 digit Alphanumeric Structure of GSTIN
- State-wise
- Based on PAN
- 13th Digit for Business Verticals of
entities with same
- PAN in same State
- 14th digit left blank for future use
- 15th digit – Checksum
DEFINITION OF PERMANENT ACCOUNT NUMBER
PAN Card consists ten characters like “DEEPA1649M”
First three characters i.e. “DEE” in the above PAN are alphabetic series running from AAA to ZZZ.
Fourth Character of
PAN i.e. “P” in
the PAN
represents the status of PAN holder. “P”
stands
for
Person or Individual. Normally the Fourth Character will represent the following.
A
|
Association of Persons
|
B
|
Body of Individuals
|
C
|
Conpany
|
F
|
Firm
|
G
|
Government
|
H
|
HUF (Hindu Undivided
Family)
|
J
|
Artificial Judicial
Person
|
L
|
Local Authority
|
T
|
Trust
|
P
|
Person or Individual
|
Fifth character i.e. “A” in the above PAN represents first character
of
the PAN holder’s last name/surname.
Next four characters
i.e.
“1649”
in the above
PAN are sequential number running from 0001 to
9999.
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