NOVEMBER 2, 2019
To open a bank account, it is mandatory to provide PAN card or sign Form 60
Issued by the income tax department through the UTI or NSDL, Permanent Account Number (PAN) card remains valid for your lifetime even if you change your address. To keep a track on tax evasion and black money, the taxman has made it mandatory to quote PAN card number for carrying out several financial transactions. In case you do not hold PAN card, you will have to sign Form 60 declaration.
PAN card is must in the following cases:
1) If you are buying or selling a motor vehicle
2) Opening a bank account
3) While applying for a debit or credit card
4) Opening a demat account
5) Payment in cash of an amount exceeding ₹50,000 to a hotel or restaurant against bill at any one time
6) Cash payment of more than Rs. 50,000 in connection with travel to any foreign country or payment for purchase of any foreign currency at any one time
7) Buying mutual funds, debentures, bonds, etc worth more than ₹50,000
8) Depositing cash of over ₹50,000 in a day in a bank
9) Payment of over ₹50,000 in cash during any one day for purchase of bank drafts or pay orders or banker’s cheques from a banking company or a co-operative bank
10) If your fixed deposit exceeds ₹50,000 in one go or aggregating to more than ₹5 lakh during a financial year
11) Payment of more than ₹50,000 in a financial year to pre-paid payment instruments
12) Payment of more than ₹50,000 in a financial year as life insurance premium
13) Selling or buying of securities, other than shares for amount exceeding ₹1 lakh per transaction
14) Sale or purchase, by any person, of shares of a company not listed in a recognized stock exchange for amount exceeding ₹1 lakh per transaction
15) Sale or purchase of any immovable property for an amount exceeding ₹10 lakh or valued by stamp valuation authority referred to in section 50C of the Act at an amount exceeding ₹10 lakh
16) Sale or purchase of goods or services of any nature other than those specified above for an amount exceeding Rs. 2 lakh per transaction
Exceptions to the PAN rule:
1) Just in case you do not have PAN, Income Tax department rules allows you to carry out any of the above transactions after signing a declaration in Form 60 which states that you do not hold a PAN card and the income is below taxable limit.
2) Minors are allowed to quote PAN card number of a parent or guardian only if he or she does not have any taxable income.
3) NRIs get relaxation in quoting PANs in some cases.
4) According to rule 114B, the central government, state governments and the consular offices are not required to mention PAN card numbers.
The Aadhaar card rule in lieu of PAN:
The Aadhaar card rule is now another exception but valid only for those who have been allotted a PAN. For example, if the PAN car number is not readily available before you or you have misplaced it, you can easily quote your Aadhaar card number instead of PAN.
With effect from September 1, the income tax department has allowed all PAN card holders to mention Aadhaar number in lieu of PAN. You can use it not only for filing your income tax returns but also for carrying out the above specified transactions for which PAN is mandatory. But you must link PAN card with Aadhaar card.
Courtesy/Source: LiveMint
