An Overview of Permanent Account Number or PAN
A permanent Account Number (aka PAN) is a unique 10-digit code assigned to eligible taxpayers by the Income Tax Department. This 10-digit code entails both alphabets and numbers. The PAN system lets a tax authority keep track of taxpayers and their finances that fall under the tax regime. All the tax-based details of the taxpayer are recorded against an assigned PAN number.
Since PAN entails a unique code, it is assigned on an individual basis- meaning no two people can have a single PAN.
The allocation of PAN to an entity leads to a grant of a PAN card issued by the IT department. This card highlights key taxpayer information such as name, DOB, and father’s or spouse’s name. Plus, it has a taxpayer’s photograph.
The PAN card can serve as legit evidence in most government-based licenses and registration. It helps authorities affirm the applicant’s identity or DOB. Your PAN card does not have a limited validity.
Latest Updates on Permanent Account Number
On March 28, 2023, the Finance Ministry announced the extension of the deadline for PAN-Aadhaar linking till June 30, 2023. The citizens are required to complete this undertaking on the IT department portal and against a fee of Rs 1000.
If someone missed this extended deadline, their PAN shall become non-functional. But, it can be reactivated within 30 days upon intimation of the Aadhaar to the competent authority.
Types of PAN Cards
PAN cards are accorded to various entities falling under the tax regime. This is what serves as a ground for PAN classification. The following types of PAN are available in the status quo:
- PAN Card for Indian Individuals
- PAN Card for Indian Entities
- PAN for Foreign Nationals
- PAN for Foreign Entities
PAN Cards issued to individuals carry information like name, DOB, signature, issuance date, etc. PAN issued to entities does not have the photograph or signature.
Who is the issuing authority of PAN cards?
PAN Card is accorded by the Income Tax (aka IT) Department with the assistance of recognized district-level PAN agencies, Protean eGov Technologies Limited, and UTI Infrastructure Technology and Services Limited.
There are many TIN-facilitation and PAN centers pan India that work under Protean eGov Technologies Ltd and let users secure their PAN.
The process concerning PAN facilitation operates on a model called PPP (Public Private Partnership). This model helps with the seamless processing and management of PAN applications.
Significance and Uses of a PAN
Securing a PAN card is an absolute mandate for taxpayers because it helps tax authorities to keep eye on your cash flow. PAN lets taxpayers pay taxes, receive tax refunds, and have correspondence with the IT department. PAN continues to remain a mandatory gateway to execute a large number of fiscal transactions.
The card holders can also use a PAN card as an identity proof to serve various purposes such as applying for a license or enrollment for a specific course or opening a demand account.
Common Uses of PAN in Financial Transactions
What are the benefits of having a PAN from a Taxpayer’s standpoint?
How PAN is different from TAN and TIN?
TAN (aka Tax Deduction and Collection Account Number) refers to a 10-digit number issued to taxpayers and entities who collect and deduct tax on payments made as a part of TDS falling under the IT Act. Taxpayers need to quote it while applying for TDS challans made to dispense the refund and certificates. Failing to do so can incur a monetary penalty.
TIN (aka Taxpayer Identification Number), on the contrary, is an 11-digit number that establishes dealers’ identity falling under the VAT regime. Granted on a state-wise basis, it is mandatory for eligible taxpayers (be it an entity or a trader, or a dealer) to secure a TIN. This number is essentially found on invoices, orders, or quotations.
Who is mandatorily required to secure a PAN?
What are the consequences of not having a PAN Card?
If the eligible taxpayer chooses to skip the Pan card, he/she may encounter the following consequences:
How can a Taxpayer apply for a PAN Card?
The eligible taxpayer can visit the following portals to apply for a PAN card:
There is an offline mode as well to serve this purpose. In this mode, the applicant needs to visit the district-level PAN agencies to apply for a PAN.
The PAN card holders can make changes in their PAN as and when required. The tax authority also issues a duplicate PAN card in case the cardholder lost their original PAN.
What types of forms are available for PAN card application filing?
The following are the different forms for PAN card application filing:
Form 49A serves as an application to apply for a new PAN. Indian taxpayers and NRIs (including NGOs, companies, trusts, local bodies, etc) must fill out this form.
Form 49AA is needed to file by overseas nationals and entities. These forms are required to be submitted to the Income Tax PAN Services Unit along with some mandatory paperwork.
The tax authority provides the applicant with an acknowledgment number to track the application progress or status, be it a grant of a new PAN or authorizing changes made to the existing PAN.
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Mandatory paperwork to apply for a PAN Card
Filing a PAN card application also requires the submission of mandatory paperwork, which goes along with Form 49A or 49AA. The section below shows the list of documents that one must share with authority without fail.
Documents for an individual applicant
Documents for Hindu Undivided Family (HUF)
Documents for companies, partnership firms, and Trusts
Documents for Association of Persons
Agreement copy or registration number accorded by the Charity Commissioner or Registrar of Co-operative Society.
Documents for foreign nationals
How to file an online application for a PAN card?
The section below entails the online process to apply for a brand new PAN card:
Step 1: Visit the NSDL portal and choose the application type
Step 2: Select an apt category
Step 3: Enter your name, DOB, and contact details in the relevant field.
Step 4: Read and accept the terms and conditions
Step 5: Complete the Captcha verification and hit the Submit button.
Step 6: The new page shall prompt on your screen. Here you will come across an acknowledgment number.
Step 7: On the next window, enter the apt information.
Step 8: Lastly, upload the paperwork (as discussed in the next section) and complete the payment formalities concerning an application fee.
What is the offline procedure to apply for PAN Card?
Following are the detailed steps that will let you apply for a PAN card in an offline mode:
You will be provided with an acknowledgment number which will help you track the application progress.
How can I apply for a Duplicate PAN Card?
Those who have lost their PAN card for any reason can apply for a duplicate one in the following way:
- Head to the UTIITSL portal
- Get access to the form namely Form 49 A. (Note: if you are an overseas applicant, select form-49 AA)
- Fill up the form with the required details and upload the paperwork if prompted.
- Next, head to the payment section to submit the fee. (Note: You can also demand a draft for this purpose).
- Download the form and take out the print.
- Send the hard copy to the Income Tax PAN Services Unit,
How to make corrections or changes to a PAN Card?
In such a case, you will be required to follow the given steps carefully:
- Visit the NSDL portal and choose the option namely- ‘Changes or Correction in existing PAN Data/ Reprint of PAN Card
- Enter the required information and click the Submit tab.
- Tap on the option namely- ‘Continue with PAN Application Form
- Enter the required information in the following window
- Choose the mode of application submission
- Select the type of PAN and enter your contact detail
- Upload the required paperwork and tap the “submit” button
- Submit the fee.
- The revised PAN shall be sent to your address within a couple of days.
What are the potential benefits of PAN e-KYC?
PAN opens a doorway to e-KYC, which has become a primary and the most secure way of establishing an identity of a customer. Countless service providers use this method of customer vetting in the status quo.
In essence, the e-KYC via PAN renders the following benefits:
With a PAN in place, you can provide a service provider with the required details at blazing speed. This can pave the way for quicker processing.
Since PAN e-KYV requires no paper, it enables seamless management of details and paperwork.
With PAN e-KYC, whatever data is shared between the concerned parties stays authentic and secured.
PAN e-KYC mitigates the scope of third-party intervention or breaches thanks to the encrypted channel. That means data during transit shall remain safe no matter the situation. And without the parties’ consent, no data shall be transferred. However, for successful e-KYC, PAN should be linked with your Aadhaar.
How to perform PAN Card Enquiry, Tracking, or Online Status Check?
You can undergo the following steps to track the PAN application and its progress through the specified portals:
Do's and Don'ts concerning PAN Application
As an applicant, you need to pay attention to the following facts to avert any chance of application rejection:
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Obtaining a Permanent account number is one of those legalities that taxpayers cannot overlook. It is because doing so can lead them to the zone where stringent penalties would come into effect. That is why qualified taxpayers must obtain the PAN as soon as possible.
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Frequently Asked Questions
As an individual applicant, you need to arrange the following documents.
- Identity proof such as DL, Aadhaar, Voter ID, etc.
- Address proof such as water bill, power bill, credit card statement, bank account statement, DL, marriage certification, etc.
Some common documents include the followings:
- Affidavit accorded by the HUF’s Karta. It must reflect the name, address, and father’s name.
- Individual applicants falling under HUF must submit address proof, identity proof, and date of birth proof.