10 Reasons Why PAN Card is Important in India

Importance of PAN Card in India

PAN card i.e. permanent account number is provided by Income tax department to every income tax payer. But do you know that PAN card is compulsory and required by following authorities while doing financial transactions with them:

While opening a new bank account

It is must to produce a photocopy of PAN card while applying for a new bank account be it public/private/co-operative or other banks. However in the recently started financial inclusion program – Pradhan Mantri Jan Dhan Yojana (PMJDY), PAN card was not required by participating banks. Check out PMJDY benefits.

Applying for credit or debit card

Quoting your PAN is must when applying for debit or credit card. Not submitting this will straight away result in application getting rejected. Credit card application rejection can cause problem in getting loan, credit card etc. in future and impact your credit score. Check out how to reasons of poor credit score.

Insurance payment

CBDT has mandated insurance policy holder to furnish PAN details while making any premium payment to insurance companies for amount exceeding Rs. 50,000 in an year.

Purchase or sell of vehicle

If you are are planning to buy or sell vehicle whose cost is greater than Rs. 5,00,000 then submitting a copy of PAN card is compulsory.

Buying or selling property (immovable asset)

Any property transaction for amount exceeding Rs. 5 Lacs requires this number to be mentioned in the property document. Buying or selling is impossible if you do not have this. In case, it is a joint property then PAN details of each person is required.

Jewellery purchase

High value jewellery purchase for amount greater than Rs.5,00,000 (5 Lacs) requires buyer to provide PAN number.

Fixed or cash deposit

Opening a fixed deposit account or cash deposit for amount greater than Rs. 50,000 at any bank requires the permanent account number. Failure to submit the same would result in TDS getting deducted at 20% if the interest amount of FD account exceeds Rs. 10,000 which is higher than the current 10%.

New telephone connection

All telecom companies have been mandated by Government of India to get PAN details of each applicant for normal or cellular connection to keep a tab on terrorism, extortion charges etc.

Investing in securities

Transactions exceeding Rs. 50,000 for equities/mutual fund/debentures/bonds requires investor’s PAN card.

Opening account at broker

For trading in share market, you need to open account with a share broker for which submitting PAN details is mandatory. Failure to provide this will result in rejection of your application.

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3 Comments
  • MIDHU K JOSEPH

    FOREIGN COMPANY PAN APPLICATION
    PAN REGISTRATION IN INDIA BY FOREIGN COMPANIES :
    As per Indian govt rules all foreign companies and organisations , are required to obtain a pan number . from income tax authorities of India . According to what has been specified in section 206AA which was inserted by the finance (no:2)Act , 2009 ,
    APPLICATION FOR ALLOTMENT OF PAN IS FORM 49AA FOR NON RESIDENTS. A CHECK LIST FOR OBTAINING PAN OF FOREIGN PARTIES GIVEN BELOW FOR YOUR REFERENCE IN ADDITION TO CHECK LIST PROVIDED AT THE END OF THE FORM :
    1. NOTARIZED AND CONSULARISED COPY OF CERTIFICATE OF INCORPORATION – COI ( SPECIFYING THE NAME , ADDRESS AND DATE OF INCORPORATION ). NOTARIZATION AND CONSULARISED SHALL BE DONE BY THE INDIAN EMBASSY IN RESPECTIVE COUNTRIES.
    2. IN CASE COI DOESNT SPECIFY THE ADDRESS OF THE COMPANY , PLEASE PROVED ANY OTHER CERTIFICATE.
    3. A PRINT OUT OF APPLICATION IS REQUIRED TO BE SIGNED BY THE AUTHORIZED SIGNATORY OF THE COMPANY. IN THIS REGARD, PLEASE NOTE THAT :
    * SIGNATURES SHOULD BE MADE IN BLACK INK AND WITHIN THE DESIGNATED BOX GIVING IN THE “PAGE 2” SHEET.
    * SIGNATURES SHOULD NOT OVERLAP OR CROSS THE DESIGNATED BOXES. ALSO AFFIX COMPANY STAMPAT THE PLACES OF SIGNATURES. NO PHOTOGRAPH NEEDS TO ATTACHED IN CASE OF COMPANIES.

    Reply
  • Saroj singh

    Pan card not received

    Reply
  • Diya Pardasani

    Hi,
    I am working in UAE with a foreign company. It has no permanent establishment in India, no office, no representative office and does not intend to do so. However, we supply to an India company. They have asked us to avail India PAN CARD for tax reduction.
    could you please explain, how an Indian company avail reduction on Tax they pay to govt by securing PAN card of their foreign supplier ?
    We wish to supply them, as opportunity exists, however we do not have any bank account are not a tax payer in India.
    Also if we get a India PAN card, will we be levied with Tax on doing business with Indian company ?
    please advise.

    Thanks and REgards,
    Diya Pardasani.

    Reply
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