Simplified Laws Guide to Taxation and Legal Concern Permanent Account Number (PAN) is a ten-digit alphanumeric number by the Income Tax Department, allotted to any “person” who applies for it. PAN enables the department to link all transactions such as Income Tax payments, TDS/TCS credits, returns of income, specified transactions, correspondence, and so on. PAN, thus, acts as an identifier for the taxpayer with the tax department.
Is it mandatory to obtain PAN?
Every company, firm or LLP compulsorily has to file tax returns, irrespective of doing business or not. Hence, obtaining PAN is mandatory. Secondly, it is also compulsory to quote PAN in all documents pertaining to financial transactions such as sale of purchase of immovable property, motor vehicle, time deposit, etc. Similarly, all citizens having taxable income have to obtain PAN.
How to apply for PAN?
A person wishing to obtain PAN can apply for PAN by submitting the PAN application form (Form 49A/49AA) along with the related documents and prescribed fees at the PAN application center of UTIITSL or NSDL. PAN application form (i.e. 49A/49AA) can be down loaded from www.incometaxindia.gov.in. An online application can also be made from the website of UTIITSL or NSDL (i.e. www. utiitsl.com and www.tin-nsdl.com)
What documents to be submitted along with the PAN application?
The documents required to be submitted with the PAN application are specified in Rule 114 of the Income-tax Rules. The details of the documents required are also provided in the application form. The applicants have to provide document pertaining to proof of identity, proof of address and proof of date of birth. The name of the applicant as mentioned in application form and the name appearing in the documents submitted along with the application should match exactly
What documents will serve as proof of identity in case of individuals not being a citizen of India?
Copy of following will serve as proof of identity in case of individuals not being a citizen of India :
Copy of passport, or
Copy of Person of Indian Origin (PIO) card issued by Government of India, or
Copy of Overseas Citizen of India (OCI) card issued by Government of India, or
Copy of other national or citizenship Identification Number or Taxpayer Identification Number duly attested by “Apostille” (in respect of countries which are signatories to the Hague Apostille Convention of 1961) or by the Indian Embassy or High Commission or Consulate in the country where the applicant is located or authorised officials of overseas branches of Scheduled Banks registered in India.
What is TAN?
TAN or Tax Deduction and Collection Account Number is a unique ten-digit alpha-numeric number required to be obtained by all persons who are responsible for deducting or collecting tax.
How to apply for TAN?
An applicant will fill Form 49B online and submit the form. Deductor may either make an online application through TIN (Tax Information Network) or submit physical TAN application to any TIN-Facilitation Center (TIN-FC) of NSDL.
Is it compulsory to obtain TAN? Is there any penalty?
The provisions of Section 203A of the Income Tax Act, 1961 require all persons who deduct or collect tax at source to apply for the allotment of TAN. The section also makes it mandatory to quote TAN in all TDS / TCS / Annual Information Returns, payment challans and certificates to be issued. Deductor cannot file TDS / TCS statements and deposit challans for TDS / TCS payments in banks without TAN. Failure to apply for TAN or not quoting the same in the specified documents attracts a penalty of Rs.10,000/-.
