PAN Card

Permanent Account Number or PAN is a mode of identifying taxpayers across the country. PAN is set in the form of a 10-digit unique identification alphanumeric number (containing both alphabets and numbers) assigned to Indians, mainly to those who pay tax. The PAN system of identification is a computer-based system that assigns a unique identification number to every Indian tax-paying entity. Through this method, all tax-related information for a person is recorded against a single PAN number which acts as the primary key for storage of information. This is shared across the country and hence no two people on tax paying entities can have the same PAN.

PAN is an electronic system through which all tax-related information for a person/company is recorded against a single PAN number. This acts as the primary key for the storage of information and is shared across the country. Hence no two tax-paying entities can have the same PAN.

When PAN is allotted to an individual or entity, PAN Card too is assigned by the Income Tax Department. While PAN is a number, PAN Card is a physical card that has the PAN number as well as the name, date of birth (DoB), and photographs. Copies of PAN card can be submitted as proof of identity or DoB.

The PAN Card is not only issued to individuals. Companies and partnership firms can also avail a PAN Card and it becomes mandatory for such entities to have a PAN number when they are filing their income tax returns. Even in the case of individuals, minors, students and Non-Resident Indians can also apply for PAN Card online.

Importance of PAN Card

PAN Card is important for taxpayers as it is necessary for all financial transactions and is used to track the inflow and outflow of your money. It is important when paying income tax, receiving tax refunds, and receiving communication from the Income Tax Department. PAN is a unique identification number that enables each tax-paying entity of India with the following:

• Proof of Identity
• Proof of Address
• Mandatory for Filing Taxes
• Registration of Business
• Financial transactions
• Eligibility to open and operate Bank Accounts
• Phone Connection
• Gas Connection
• Mutual Fund – PAN is beneficial to complete e-KYC for mutual fund investments.

The union budget 2019 had proposed for taxpayers to use Aadhaar instead of PAN for filing income tax returns on or after 1 September 2019. It has been proposed in the union budget 2019 that the Income-tax officer can themselves allot PAN to taxpayer filing return with Aadhaar.

Types of PAN Cards

Since a PAN Card can be availed by both individuals and entities, different types of PAN Cards need to be applied through different variants of Form 49 that are issued by the government. Here are the different types of PAN Cards and the different Forms used for availing the same.

PAN Card for Individuals - This is the most common variant of the PAN Card that is issued to individuals. This card is applied through Form 49A available online through the NSDL and UTIITSL websites. Individuals include any resident Indian including minors and students as they are also eligible for a PAN card.

PAN Card for Non-Resident Individuals or Persons of Indian Origin - NRIs and PIOs can avail a PAN Card for taxation in India. They too would have to submit Form 49A for availing this card.

PAN Card for foreign entities paying tax in India - Firms or corporates which are registered outside India but pay tax in India by virtue of their business operations conducted in India can also avail a PAN Card. They would have to fill and submit Form 49AA as part of the PAN card application process.

PAN Card for OCI and NRE - Overseas Citizens of India and Non-Resident Entities can also apply for a PAN Card. The relevant form which should be filled out by them when applying for the PAN card is Form 49AA.

PAN Card for Indian Companies - Firms and corporate entities registered as well as working in India can also apply for a PAN Card for their financial and tax-related transactions.

Information Contained in a PAN Card

A PAN card contains some very basic information which also qualifies it as an identity and an age proof when complying with the Know Your Customer (KYC) guidelines. The details contained in the card are as follows:

Name of the cardholder – The primary and the most noticeable detail on the PAN Card is the name of the cardholder. In case of an individual, it is the individual’s name, in case of a company, the registered name of the company and case of a partnership firm, the name of the firm is mentioned on the PAN Card.

Name of the father of the cardholder – This is applicable in case of individual cardholders. The name of the father of the cardholder is mentioned beneath the name of the individual.

Date of birth – The cardholder’s date of birth is mentioned beneath the name of the father in case of an individual’s PAN card. This detail acts as the date of birth proof of the cardholder. In the case of companies and partnership firms, their date of registration is mentioned in this field.

PAN Number – The next and the most important content of the card is the PAN number or the Permanent Account Number. The PAN number is unique to every person/entity holding the card and it contains some key information. The number is generated based on the details provided by the entity. It is a 10-letter alpha-numeric number and each character represents information. Such information is as follows:

The first three letters – These three letters are purely alphabetical and contain three letters of the alphabet from A to Z.

Fourth letter – The fourth character of the PAN number represents the category of the taxpayer the entity is. The various entities and their respective characters are as follows:

• A – Association of Persons
• B – Body of Individuals
• C – Company
• F – Firms
• G – Government
• H – Hindu Undivided Family
• L – Local Authority
• J – Artificial Judicial Person
• P – Individual
• T – Association of Persons for a Trust

The fifth letter – the fifth letter is the first letter of the individual’s surname

Remaining letters– remaining characters are random. The first 4 characters are numbers while the last one is an alphabet.

Signature of the individual – the last detail on the PAN card is the signature of the individual. As such, a PAN Card also acts as proof of the individual’s signature required for various financial transactions.

Photograph of the individual – the photograph of the cardholder is also present in the lower right-hand side of the PAN Card which makes the card eligible to act as a photo identity proof of the individual. In the case of companies and firms, no photograph is present on the card.

PAN Card Application Process

A PAN Card can be applied for in two ways. One can apply online for a pan card through the popular online pan card application process or alternately, the offline mode of PAN card application can also be used. In the following sections, we will discuss the different methods you can use to apply for and get a PAN card.

Online PAN Card Application Process - Here are the steps which are to be followed when applying for the PAN Card using the online mode of application and PAN card registration:

• Step 1: Visit the relevant website of NSDL or UTIITSL for online application for PAN Card.
• Step 2: On the website select the option ‘New PAN’ on the home page.
• Step 3: There is a new PAN Card Form 49A which should be selected for individuals whether they are Indian Citizens, NRE/NRI or OCI Individuals.
• Step 4: This form should be filled with the individual’s details.
• Step 5: The applicant would also be required to pay the processing fee online through a Demand Draft after submitting the form to initiate processing of the form.
• Step 6: The final page which is generated after paying the fees and submitting the filled-out PAN Form 49A contains the 15-digit acknowledgement number.
• Step 7: The acknowledgement form should be sent to the NSDL PAN office by courier within 15 days of online submission of Form 49A along with the concerned documents.
• Step 8: After the acknowledgement form is couriered to the NSDL office, PAN no. verification is done and the Card is generated after the NSDL PAN verification. The physical PAN card is sent to the customer’s address as mentioned in the form within 15 days.

Offline PAN Card Application Process - Applying for the PAN Card can also be done offline at any district-level PAN agency.

• Download the PAN card application form from the NSDL or UTIISL websites or collect a copy from UTIISL agents.
• Fill in the form and attach supporting documents (proof of identity, address and photographs)
• Submit the form and documents to the NSDL office along with the processing fee.
• The PAN card will be sent to the address mentioned in the form within 15 working days.

How to Check PAN Card Status

Know your PAN status – One can track PAN Card status online after the applicant has applied for it. The PAN Card application status can be tracked where the PAN status shows whether the card has been issued or not or if it is currently in transit. The applicant can check PAN Card status or check the UTI PAN card status/NSDL PAN card status on the respective websites. The UTI PAN Card status is available on UTIITSL and the NSDL PAN status is available on the NSDL website and both show the respective PAN application statuses. The status of PAN Card can thus be tracked online and one can figure out the online PAN Card status by name and date of birth entered in the websites.

Making changes in a PAN Card - Existing PAN cardholders can make changes on their existing PAN Card details while at the same time retaining the PAN Number. Any correction in the details contained in the PAN Card can also be made using this procedure. For this, a PAN Card update or correction form needs to be filled and submitted to the relevant authority.

Documents Required for a PAN Card

Certain documents are required to be submitted along with the PAN Card application form (Form 49A or Form 49AA) or the acknowledgement form (if applying online) for PAN card verification process. The requirement of documents could vary depending on the applicant. Key documents which are required along with the PAN application form when individuals or other entities apply for a PAN card. Find below the list of documents required for pan card:

For an individual applicant:

• Identity Proof which can be a copy of either of the following:

• Any govt. issued ID – Aadhar, DL, Voter ID, etc.
• Arm’s License
• Pensioner Card which contains the applicant’s photograph
• A photo ID card which is issued by Central Government, State Government or a Public Sector Undertaking
• Central Government’s Health Scheme Card or Ex-Servicemen’s Contributory Health Scheme Photo Card
• An original bank certificate which is issued on the bank’s letterhead from the branch of the bank and attested by the issuing officer. Such a certificate should contain an attested photograph of the applicant along with the bank account number.

An address proof which can be a copy of any one of the following:

• Electricity, landline or broadband connection bill
• Post-paid mobile phone bill
• Water bill
• LPG or piped gas connection bill or Gas Connection book
• Bank account statement
• Credit card statement
• Deposit account statement
• Post Office account Passbook
• Passport
• Voter’s ID Card
• Driving License
• Property registration document
• Domicile certificate issued by the Indian Government
• Aadhar Card
• Original certificate from the employer-provided that the employer is a reputed public or private corporation
• Date of birth proof which can be a copy of any one of the following:
• The birth certificate which is issued by the Municipal Authority or any authorized authority
• Matriculation certificate
• Pension Payment order
• Passport
• Marriage certificate issued by Registrar of Marriages
• Driving license
• Domicile certificate issued by the Indian Government
• An affidavit sworn before a magistrate stating the applicant’s date of birth

For a Hindu Undivided Family (HUF)

• An affidavit issued by the Karta of the HUF stating the name, address and the father’s name of every coparcener as on the date on which the application is made.
• Identity proof, address proof and date of birth proof as in case of an individual for the Karta of the HUF.

For a company registered in India

• A copy of the Certificate of Registration issued by the Registrar of Companies.

For firms and Limited Liability Partnerships formed or registered in India

• A copy of the Certificate of Registration issued by the Registrar of Firms or Limited Liability Partnerships.
• A copy of the Partnership Deed.

For Trust formed or registered in India

• Copy of Trust Deed or a copy of the Certificate of Registration Number issued by a Charity Commissioner.

For an Association of Persons

• Copy of Agreement/Certificate of Registration Number from Registrar of Co-operative Society or Charity Commissioner or other competent authority or any document issued by the Central/State Government which shows identity and address of the applicant.

For individuals who are not Indian Citizens

• A proof of identity which can be any one of the following:
• Passport copy
• Copy of PIO card issued by the Indian Government
• Copy of OCI Card issued by the Indian Government
• Copy of other national or citizenship Identification Number or TIN attested by applicable ‘Apostille’, Indian Embassy, High Commission or Consulate where the applicant is based.
• Address proof can be any one of the following:
• Passport copy
• Copy of PIO card issued by the Indian Government
• Copy of OCI Card issued by the Indian Government
• Copy of other national or citizenship Identification Number or TIN attested by relevant ‘Apostille’, Indian Embassy, High Commission or Consulate
• Copy of bank statement of the residential country
• Copy of NRE bank statement in India
• Copy of resident certificate or Residential permit
• Copy of registration certificate issued by FRO
• Copy of VISA and appointment letter from any Indian company

Important Points to Remember in PAN Card Application

• Fill in all the details as per the identity and address proof documents you are submitting.
• Get your thumb impression attested by a Magistrate/Notary before submitting the form, to avoid disqualification.
• Write the complete address and provide accurate contact details in the form.
• Fill in the application form in capital letters.
• Don't make corrections or over-write anywhere on the form.
• Do not use initials in the first name or last name columns.
• Do not apply for a new PAN card if your old PAN card is lost/stolen/defaced. Request for a duplicate PAN instead.

Uses of PAN Card in Financial Transactions

• PAN needs to be quoted while paying direct taxes.
• Taxpayers need to input their PAN when paying income tax.
• While registering a business, PAN information needs to be furnished.
• A lot of financial transactions require PAN information. Some of these transactions are:
• Sale or purchase of property (immovable) which is valued at Rs.5 lakh or above
• Sale or purchase of a vehicle except for a two-wheeler
• Payments made towards hotels and restaurants and which are above Rs.25,000
• Payments made in connection with travel requirements to other countries. The amount in this case if it exceeds Rs.25,000, then you need to quote your PAN
• Payments of more than Rs.50,000 towards bank deposits
• Purchase of bonds worth Rs.50,000 or more
• Purchase of shares worth Rs.50,000 or more
• Purchase of insurance policy worth Rs.50,000 or more
• Purchase of mutual fund schemes
• Payments made for more than Rs.5 lakh towards the purchase of jewellery and bullion
• To remit money out of India
• Transfer of funds from NRE to NRO account

Steps to Follow for Duplicate PAN Card

In case you have lost your PAN card, you can apply for a duplicate PAN card online as well as offline. TIN-NSDL and UTIITSL allow people to fill the form and make the payment online for a duplicate copy of your PAN card. Here’s how you can do it:

• Go to TIN-NSDL or UTIITSL website and apply for a duplicate copy of your PAN card.
• Fill the form 49A in case of Indian citizen and Form 49-AA in case of foreigners.
• Make the payment online or get a demand draft issued.
• Now take the print out of your form and send it to Income Tax PAN Services Unit, NSDL e-Governance Infrastructure Limited, 5th Floor, Mantri Sterling, Plot No. 341, Survey No. 997/8, Model Colony, Near Deep Bungalow Chowk, Pune – 411 016
• You will receive your PAN card in next 45 days.

PAN Card FAQs

End Note

The primary purpose of the PAN card is to bring a universal identification to all financial transactions and to prevent tax evasion by keeping track of monetary transactions, especially those of high-net-worth individuals who can impact the economy. You can use your PAN for e-KYC. e-KYC is a major requirement which is asked for by most service providers and it offers several benefits.