PAN is a permanent account number in form of an n alpha numeric code. It is issued to an individual or a firm with a lifetime validity. The PAN is issued in a form of a plastic laminated card. It is launched by the income tax department to curb fraudulent financial transactions. The Permanent account number is mandatory for certain financial transactions. Such transactions include receiving taxable salary or fees, sale and purchase of assets with certain limits. It is also mandatory for buying mutual funds. It is powerful tool to trace identity of a person or firm as it stays unaffected by any change in address.
Who Should Apply for PAN?
It is mandatory to have a permanent account number for:
· Anyone who is earning a taxable income including foreigners who pay taxes in India
· Anyone who does a retail business or service or consultancy and has sales or turnover exceeding Rs. 5 lakhs
Besides this, it is mandatory to produce apply for pan card number to carry out certain financial transaction up to the specified limit.
Why you should Get a PAN Number
You need a permanent account number to carry out following procedures:
1. For payment of all the direct taxes
2. To file income tax returns
3. To avoid tax deduction at higher rate
4. For sale and purchase of fixed properties of Rs. 5 lakhs or above
5. Sale and purchase of any vehicle except a two-wheeler
6. For paying restaurants or hotels an amount of and above Rs. 25000/-
7. To make a payment of and above Rs. 25,000/- in cash. (Related to travel to any other country)
8. For payment of Rs. 50,000/- and above to the RBI for bonds
9. Paying Rs. 50,000/- or more to any company or institution for procurement of debentures or bonds.
10. For purchase of mutual funds
11. For depositing money above Rs. 50,000 with a bank in 24 hours.
12. To pay purchase of jewellery and bullion (of and above Rs. 5 lakhs).
If you are planning to apply for a PAN card, you should do it through the portals of e-Mudhra, NSDL, or UTI. Follow us for the procedure of the online application of PAN card, aadhar card, passport, and voter ID card status.