PAN Card - Structure, Provisions & How to apply for PAN

In present days PAN card is a common identification card not only for tax payers but also for them who have bank account. I this article I'm going to share briefly about PAN structure, its uses and how to apply for PAN. Let's read:

Permanent Account Number (PAN) is a identification code for Indian nationals, especially those who pay Income Tax. It is a unique, 10-character alpha-numeric identifier, issued to all judicial entities identifiable under the Indian Income Tax Act, 1961. It is issued by the Income Tax Department, India under the supervision of the CBDT

The PAN is mandatory for a majority of financial transactions such as opening a bank account, receiving taxable salary or professional fees, sale or purchase of assets above specified limits etc.;especially high-value transactions.The primary purpose of the PAN 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.The PAN is unique to each individual and is valid for the life time of the holder, throughout India. An important point to note would be that once issued, the PAN is not affected by a change of address. Even address is not printed on PAN card, it is only written in PAN allotment letter.

Structure & Provision of PAN

• Income Tax PAN card is issued under Section 139A of the Income Tax Act.
• The PAN structure is as follows: AAAPL1234B: First five characters are letters, next four numerals, last character letter.
• The first three letters are sequence of alphabets from AAA to ZZZ
• The fourth character informs about the type of holder of the card. Each holder is uniquely defined as below:

A — Association of Persons (AOP)

B — Body of Individuals (BOI)

C — Company

F — Firm

G — Government

H — HUF (Hindu Undivided Family)

L — Local Authority

J — Artificial Juridical Person

P — Individual

T — AOP (Trust)

K — Krish (Trust Krish)

• The fifth character of the PAN is the first character
• (a) of the surname or last name of the person, in the case of a "Personal" PAN card, where the fourth character is "P" or
• (b) of the name of the Entity, Trust, society, or organisation in the case of Company/ HUF/ Firm/ AOP/ BOI/ Local Authority/ Artificial Judicial Person/ Govt, where the fourth character is "C","H","F","A","T","B","L","J","G".
• The last character is an alphabetic check digit.

In recent times, the DOI (date of issue) of the PAN card is mentioned at the right (vertical) hand side of the photo on the PAN card if issued by NSDL and will not be mentioned if issued by UTI-TSL.
The central government has introduced a new online service called "Know Your PAN"to verify or validate new and existing PAN numbers.
Failure to comply with the provisions of Section 139A of Income Tax Act, penalty of Rs. 10,000/- for each default is payable u/s.272B by Assessing Officer.

Use of PAN 

Quoting the PAN is mandatory when filing Income Tax returns, tax deduction at source, or any other communication with Income Tax Department. PAN is also steadily becoming a mandatory document for opening a new bank account, a new landline telephone connection / a mobile phone connection, purchase of foreign currency, bank deposits above Rs. 50,000/=, purchase and sale of immovable properties, vehicles etc.

Following forms have been notified by ITD for submitting applications for allotment of new PAN:

Apply for PAN card
You can apply for new PAN card in online or offline.
Remember you can apply for PAN online only if you have Digital signature certificate.

For online application you can visit NSDL or UTI TSL.

For offline application you can simply download and fillup

FORM 49A: - To be filled by Indian citizens including those who are located outside India.
FORM 49AA: - To be filled by foreign citizens.



Hope this article help you a lot. For more information, please ask in the comment box.

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