Things you need to know about PAN Card

Things you need to know about PAN Card

What is PAN card?

The word PAN stands for ‘Permanent digit alphanumeric Account Number’. It is issued by Income Tax department. PAN is a ten digit alphanumeric identifier. Each Indian taxpaying entity like – individual, firm, Hindu undivided family, company etc. is issued a unique PAN. PAN is allotted across the country, hence no two people on tax paying entity can have the same PAN.

Once the PAN issued it is valid for the entire lifetime of the PAN card holder. The reason is PAN is unaffected by the change of the PAN card holder.

Structure of PAN

The structure of PAN is as follows : XXXXX9999X. this structure is divided into 5 parts.

Suppose ABUPG2145P –

ABU / P/ G / 2145 / P

  • First three letters are alphabetic series, running from AAA to ZZZ.
  • Fourth letter shows the Status like – Person, HUF, Company etc.
  • Fifth letter is the first letter of surname/last name of the card holder.
  • And last digit is alphabetic check digit.

The fourth character of the PAN is very important character of PAN, it shows the status of the card holder as following –

C – Company

P – Person

H – HUF (Hindu Undivided Family)

F – Firm

A – Association of Persons (AOP)

T – AOP (Trust)

B – Body of Individuals

L – Local authority

J – Artificial Judicial Person

G – Government

What are the uses of PAN card?

Basically PAN acts as an identifier for the person with the tax department. There are various uses of PAN card in every assessee life. These are given below –

  1. Filing IT Returns – PAN card is very important at the time of filing ITR. And it is the primary reason every individual and entities apply for this.
  2. Opening a bank account – PAN is required for opening a bank account, whether it is saving account or current account. All banks be it private, public and co-operative ask for submission of PAN card.
  3. Applying for debit/credit card – Furnished details of PAN card is mandatory at the time of applying for debit or credit card.
  4. At the time of Investment – at the time of investing in securities, mutual funds or any financial instruments, investors are mandatorily provide their furnished detail of their PAN card.
  5. Proof of Identity – PAN card is accepted as a proof of identity anywhere in India. It is also considered as a proof of age.
  6. Applying for Loans – when you apply for any kind of loan in banks or any financial institution, they ask to submit your PAN details along with your loan application. Whether you apply for education loan, personal loan or housing loan you have to provide your Pan details for the loan to be approved.
  7. Cash Deposit – if you are depositing cash more than Rs. 50, 000 at one time you need to submit you PAN details, compulsorily. RBI made it mandatory in order to prevent money laundering.

How you can get a PAN Card?

You can apply for PAN card by filling up Form 49A. it is an application form for allotment of Permanent Account Number.

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