The Permanent Account Number (PAN) is a 10 alphanumeric code used to verify an individual's identity. To prevent tax avoidance, the Income Tax Department is responsible for giving this number to every potential taxpayer.
In this case, two people cannot have the same number. This is achievable because PAN is an electronic system that tracks every taxpaying citizen's financial transactions. Every person is given a laminated PAN card with their unique identification number.
Frequently, a taxpayer who will pay more than the actual tax amount, the excess amount of tax will be refunded in the account of assesse and for this bank account of assesse must be link with PAN.
It is necessary to have a PAN card in the organization's name to launch a firm or a company.
A PAN card is crucial for tax purposes. If an individual receives Rs. 10,000 in the form of interest from a savings account or a fixed deposit and has not linked his PAN card to the bank account, the bank will deduct 20% of TDS instead of 10%.
When requesting a pay order, bank cheques, or draft, a PAN card is required. If a person is transacting more than Rs. 50,000, the PAN card is required to complete the transaction.
A PAN card is required to open a Demat account, which is used to hold shares in dematerialized form.
The Income Tax Department uses a PAN card to examine an individual's or entity's monetary transactions. It assists in identifying those who are involved in tax evasion. The PAN card contains a person's name, photograph, and other personal information, making it an acceptable identity verification.
Individuals, businesses, non-resident Indians, and anybody else who pays taxes in India receive a PAN Card.
For PAN, two types of documentation are necessary. Proof of Address (POA) and Proof of Identity (POI) are two different types of proof.
To update your PAN, take the following steps:
