•Life Insurance for
NRIs/PIOs
•Fixed Deposits for NRIs/PIOs
•PPF/NSC for NRIs/PIOs
•Stocks for NRIs/PIOs
•Mutual Funds for NRIs/PIOs
•Real Estate for NRIs/PIOs
1. What is a PAN card? Answer : Permanent Account Number (PAN) refers to a ten-digit alphanum-
eric number, issued in the form of a laminated card, by the Income Tax Department in India. It is a must to have a PAN number for all those who file their income tax returns, because from 2005 onwards, it has been made mandatory by the Income Tax Department to quote the PAN on return of income as well as on all correspondence with any income tax authority in the country.
Also, it is now compulsory to quote PAN in all documents pertaining to financial transactions notified from time to time by the Central Board of Direct Taxes, such as sale and purchase of immovable property or motor vehicle or payments in cash, of amounts exceeding a certain limit to hotels and restaurants, or in connection with travel to any foreign country. It is also mandatory to mention PAN for obtaining a telephone or cellular telephone connection. Likewise, PAN has to be mentioned for making a time deposit exceeding Rs. 50,000/- with a Bank or Post Office or for depositing cash of Rs. 50,000/- or more in a Bank.
It is statutory responsibility of a person receiving document relating to economic or financial transactions notified by the CBDT to ensure that PAN has been duly quoted in the document.
Obtaining or possessing more than one PAN is against the law.
It is compulsory to quote PAN on return of income
All existing assesses or taxpayers or persons who are required to furnish a return of income, even on behalf of others, must obtain PAN
Any person, who intends to enter into financial transaction where quoting PAN is mandatory, must also obtain PAN.
The Assessing Officer may allot PAN to any person either on his own or on a specific request from such person.
2. What are the benefits of a PAN card? Answer : As explained earlier, having a PAN card - Permanent Account Number is compulsory as per the Income Tax Department of India, even if you are a Non Resident Indian living abroad wishing to do Investing in India or carry any financial transaction in India. There are not much benefits of having a pan card, as it is just a necessary rule laid by the IT department. Thus having a pan card is compulsory and this IT number must be quoted on all the financial transactions carried in India.
Benefits of a PAN Card :
It’s hard to explain advantages and disadvantages of having a pan - permanent account number. However, here are some benefits of having a PAN card:
PAN number acts as an Identity proof, showing your relation to India.
Even if you don't file taxes in India, you should still have a pan card.
Sale or purchase of immovable property valued at Rs 500,000 or more. If there are co-owners (buyer or seller), the PAN of both the owners will have to be mentioned. If a nominee holds the property, the PAN of the legal owner must be mentioned.
The PAN should be disclosed in the document pertaining to purchase or sale of the property
Sale or purchase of a motor vehicle requiring registration other than two-wheelers. This does not include vehicles running on fixed rails or special vehicles for use only in factories or in other enclosed premises or vehicles of less than four wheels with engine capacity of not more than 25 cc.
A time deposit of more than Rs.50,000 with any banking company and deposit of more than Rs.50,000 with post-office savings bank. This requirement is not mandatory when investing in post-office National Savings Certificate or Kisan Vikas Patra, and the PAN will be required only if the time deposit exceeds Rs.50,000.
Contract of sale or purchase of securities exceeding Rs.1 lakh in value, including shares, bonds, debentures, derivatives, units and government securities.
Cash payment of Rs.50,000 or more for purchase of bank drafts, pay orders or bankers cheques during any one day.
Cash payment exceeding Rs.25,000 in connection with travel to any foreign country (fare or purchase of foreign currency).
Application for installation of telephone, including cellular telephone.
Payment to hotels and restaurants against bills exceeding Rs.25,000 at any one time.
Opening a bank account.
Application for issue of a credit card.
A cash deposit of Rs.50,000 or more with any bank during any one day.
Payment of Rs.50,000 or more to a mutual fund for purchase of units or to a company for acquiring its shares or to a company/institution for acquiring its debentures/bonds or to RBI for acquiring bonds.
Minor intending to open time deposit or bank account should quote the PAN of either father or mother or guardian in whose hands income is likely to be clubbed.
3. Is it Necessary for NRIs to have a PAN Card Number? Answer : It is now compulsory for all Indians to have a PAN number as per the IT department of India. Everyone wanting to invest in India now, must have a PAN number as well. As per the Indian Tax Department, it is now necessary to have a PAN number in order to file your taxes in India. You need it when filing for you tax returns, most kinds of investments, and other financial transactions. When investing, a PAN card is needed when you open a Demat Account, invest into stocks, purchase or sell shares, purchase or sell mutual funds, or investing in other assets in the market. Other reasons you need a PAN is to buy real estate, to open a bank account, to get a loan, getting a passport, getting a visa, and to receive money from abroad.
4. Is a NRI (Non Resident Indian) required to file taxes in India because he has a PAN card?
Answer : So far, it is not required for an Indian to file even if he holds a PAN card. You only need to file taxes if you have an Income generated in India. When you file taxes, it does not mean that you will always be paying taxes. If you don’t make any money in India, you can file zero taxes. When you do this, it makes you have better credit and it makes it simpler to get a loan.
5. Where to apply for a PAN CARD?
Answer : You can apply for a PAN card to your assessing officer, in case you are already assessed to tax.
If it is another way around, you (non tax payers) can approach to the Assessing Officer dealing with new tax payers.
6. What Does a PAN CARD show? Answer :
Your PAN CARD contains :-
PAN
Name
Date of Birth
Father’s Name
Photograph
Signature
However, the same particulars are not shown in PAN Card of other taxpayers. Theirs include :
PAN
Name and
Date of Incorporation or Formation
7. Can a person hold more than one PAN under new series? Answer : No person is issued more than one PAN under the new series. If you already hold a PAN, you can’t be allotted or apply for another new one. Everyone is abided by the rule and regulations laid for the PAN card holders. Defaulters will have to pay a penalty of Rs. 500/- which may extend to Rs. 1,000/-.
8. Is it necessary to inform your accessing officer regarding PAN? Answer : YES, it is in special cases which include:
When change of name :
NAME on the basis of which the Permanent Account Number (PAN) was allotted
ADDRESS
NATURE OF THE BUSINESS:
As such, you are not needed to apply for a new PAN in case your name is changed. However, you must apply for change of name along with documentary proof of such change.
When in case of :
DEATH of a PAN holder
DISCONTINUATION OF BUSINESS
DISSOLUTION of a firm
PARTITION of a Hindu Undivided Family (HUF)
LIQUIDATION or WINDING UP of a company.
MERGER or AMALGAMATION or ACQUISITION etc. of companies.
9. Is there no situation under which a person already holding a PAN Card can get a new one? Answer :
Getting a new PAN Card is allowed in case of :
PARTITION of a big Hindu Undivided Family (HUF) into one or more new Hindu Undivided Families (HUF's)
Coming into being of a new HINDU UNDIVIDED FAMILY (HUF).
CHANGE IN CONSTITUTION of a firm (entailing change of partners)
SPLITTING UP of a company into two or more companies.
10. Is applying for a PAN Card necessary when migrating from one city to another? Answer : No. Income Tax Department eliminates the need for you to apply for a fresh PAN under the new series, if moving from one city to another. However, you must intimate your Assessing Officer for transfer of your PAN and other records to your new Assessing Officer.
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