💳 PAN CARD – COMPLETE GUIDE

1️⃣ What is PAN?

PAN (Permanent Account Number) is a unique 10-character alphanumeric code issued by the Income Tax Department of India.

• Format: AAAAA9999A

  • First 5 characters: letters

  • Next 4 characters: numbers

  • Last character: letter (checksum)

• Purpose: Identification of taxpayers, tracking financial transactions, and preventing tax evasion.

2️⃣ Who Needs a PAN?

PAN is mandatory for:

1. Individuals – salaried, self-employed, professionals

2. Businesses – proprietorships, partnerships, companies

3. Trusts & NGOs

4. NRIs (Non-Resident Indians)

5. Foreign citizens conducting business in India

Mandatory scenarios include:

• Filing Income Tax Return (ITR)

• Opening a bank account (savings/current)

• High-value financial transactions:

  • Purchase/sale of property

  • Buying/selling of shares, mutual funds, or bonds

  • Deposit/withdrawal of ₹50,000+ in cash

  • Payment of life insurance premiums above threshold

  • Vehicle purchase above ₹10 lakh

• Applying for a loan, credit card, or foreign remittance

3️⃣ PAN Card Types

4️⃣ Documents Required for PAN Application

A. Proof of Identity (POI)

• Aadhaar Card

• Passport

• Voter ID

• Driving License

B. Proof of Address (POA)

• Passport

• Aadhaar Card

• Utility bills (Electricity/Water/Gas)

• Bank statement with address

C. Proof of Date of Birth (for Individuals)

• Birth certificate

• Matriculation certificate

• Passport

D. For Non-Individuals

• Certificate of Incorporation (Companies)

• Partnership deed (Firms)

• Trust deed (Trusts/NGOs)

5️⃣ PAN Application Process

1. Choose application type – New PAN (Form 49A for Indian citizens, Form 49AA for foreigners)

2. Fill online/offline form – NSDL / UTIITSL portals

3. Attach documents – POI, POA, DOB, photographs

4. Pay application fee – ₹107 (India), ₹1,017 (Foreign)

5. Submit form & acknowledgment – 15–20 working days for processing

6. Receive PAN card – via physical print, digitally in some cases

6️⃣ PAN Card Uses

A. Tax Compliance

• File Income Tax Return (ITR)

• Quote PAN for TDS / TCS deductions

• Link with bank accounts for seamless tax tracking

B. Banking & Investments

• Open savings or current accounts

• Invest in mutual funds, stocks, bonds

• Apply for loans, credit cards, fixed deposits

C. Real Estate

• Sale / purchase of immovable property above ₹10 lakh

• Registration of property in municipal records

D. High-Value Transactions (Cash / Demat / Foreign Exchange)

• Cash deposit above ₹50,000

• Foreign remittances / inward remittances

• Buying luxury goods above threshold

E. Government Compliance

• PAN required for GST registration

• PAN for company/director registration

• Mandatory for Trusts and NGOs for audit purposes

7️⃣ Linking PAN with Aadhaar

• Government mandates PAN linking with Aadhaar for:

  • Filing ITR

  • Verifying identity

  • Avoiding duplicate PAN

• Link via Income Tax e-Filing portal, SMS, or mobile apps

8️⃣ Correction / Update in PAN

Scenarios:

• Name change (marriage, spelling error)

• Father’s name correction

• Date of birth correction

• Change in address

Process:

1. Fill PAN correction form (online/offline)

2. Submit supporting documents

3. Pay nominal fee

4. Updated PAN card issued

9️⃣ PAN Card Lost / Duplicate

• Apply online/offline for duplicate PAN card

• Provide proof of identity and acknowledgment

• Fee: ₹107 (domestic), ₹1,017 (foreign)

• PAN number remains the same, only the card is reissued

🔟 PAN & Tax Benefits / Legal Aspects

1. Quoting PAN is mandatory for all high-value transactions

2. Non-quoting PAN attracts:

   • TDS at 20% higher rate

   • Penalties under Section 272B

3. PAN helps in tracking financial fraud & black money

4. PAN is used by authorities for tax compliance, KYC, credit evaluation, and AML checks

1️⃣1️⃣ Frequently Asked Questions (FAQs)

Q1: Can one individual have multiple PAN cards?
A1: No. Duplicate PAN is illegal and punishable by fine under Section 272B.

Q2: Can PAN be used as ID proof?
A2: Yes, for banking, financial, and tax purposes. Not for voting or driving.

Q3: Is PAN mandatory for minors?
A3: Yes, if they receive taxable income or have investments above prescribed limits.

Q4: How long does PAN processing take?
A4: Usually 15–20 working days.

Q5: Can foreigners apply for PAN?
A5: Yes, via Form 49AA with supporting documents.

1️⃣2️⃣ Advisory Draft – PAN Application / Compliance

To: [Client Name]
Date: __________

Subject: Advisory on PAN Card Application and Compliance

Dear [Client Name],

This advisory is regarding the Permanent Account Number (PAN) requirements as per the Income Tax Act, 1961.

Key Recommendations:

1. Apply for PAN if not already obtained.

2. Ensure PAN details are correct, linked with Aadhaar, and updated.

3. Quote PAN in all high-value transactions, ITRs, banking, investments, and property dealings.

4. Maintain PAN records securely and avoid duplicate applications.

5. Update PAN promptly in case of name, address, or date of birth changes.

Failure to comply may result in higher TDS, penalties, or legal scrutiny.

Warm regards,
[Consultant Name]
[Designation / Organization]

1️⃣3️⃣ Website-Specific Tips for PAN Content

• Avoid giving legal guarantees; use advisory language

• Add disclaimer: “Rules are subject to change; professional guidance recommended”

• Update annually to reflect current fees, forms, and thresholds

• Include links to NSDL / UTIITSL PAN portal for online applications

🔹 ADDITIONAL / ADVANCED PAN CARD INFORMATION (NOT COVERED EARLIER)

1️⃣ PAN for Digital Transactions & eKYC

• PAN is required for digital wallets, UPI high-value transactions, and stock market eKYC.

• SEBI mandates PAN for demat account opening and mutual fund investments above ₹50,000.

• PAN helps in linking all financial transactions digitally to the taxpayer.

2️⃣ PAN for Foreign Citizens / NRIs

• Non-Resident Indians and foreign nationals can apply using Form 49AA.

• Required for:

  • Opening bank accounts in India

  • Investment in shares, mutual funds, or bonds

  • Property purchase in India

• Foreign PAN applicants must submit proof of identity, address, and passport/visa details.

3️⃣ PAN for Minors / HUFs / Trusts

• Minors can have PAN if they have taxable income or investments.

• Hindu Undivided Families (HUF) require separate PAN for business income and ITR filing.

• Trusts, NGOs, companies must have PAN for filing tax returns, audit compliance, and donations receipt.

4️⃣ PAN & High-Value Transactions Reporting (15CA / 15CB)

• PAN is required when submitting Form 15CA/15CB for payments to foreign parties.

• Used for foreign remittances exceeding INR thresholds, as part of FEMA compliance.

• PAN ensures proper TDS on payments to non-residents.

5️⃣ PAN & Tax Refunds

• PAN is mandatory to receive tax refunds from Income Tax Department.

• Refunds will only be credited to bank accounts linked to PAN.

• PAN prevents errors and delays in processing refunds.

6️⃣ PAN & High-Value Property Transactions

• PAN must be quoted for purchase or sale of immovable property above ₹10 lakh.

• Helps Income Tax Department track capital gains or property-related tax liability.

• Non-quoting PAN leads to higher TDS (20% for property transactions).

7️⃣ PAN Verification Services

• Banks, employers, and financial institutions can verify PAN online via Income Tax e-Filing portal.

• Helps ensure PAN is valid, active, and matches identity details.

• Reduces errors in ITR filing, TDS reporting, and banking transactions.

8️⃣ PAN & Cryptocurrency Transactions

• For buying/selling cryptocurrency above threshold, PAN is mandatory.

• Exchanges require PAN for KYC, reporting, and tax compliance.

• Helps link crypto holdings to Income Tax Department records.

9️⃣ PAN & Demat / Stock Trading

• PAN is mandatory for:

  • Opening demat accounts

  • Trading in stocks, bonds, IPO applications

  • Reporting capital gains and dividends

• PAN ensures tracking of trading gains for tax purposes.

🔟 PAN & Legal Consequences of Misuse

• Possession of multiple PANs: Penalty up to ₹10,000 under Section 272B

• Quoting fake PAN: Considered tax evasion

• Non-quoting PAN in transactions: TDS at higher rate (20%)

• Mismatched PAN in ITR: Leads to ITD scrutiny and notice

1️⃣1️⃣ Advanced PAN Tips for Users

• Keep PAN linked to all bank accounts, Aadhaar, mutual funds, and demat accounts

• Use PAN as universal financial ID for transparency and compliance

• Check PAN status online for activation, verification, or corrections

• Avoid sharing PAN casually to prevent identity misuse or fraud