New PAN card rules to be effective from today, here's something, you can't ignore
New Delhi : Permanent Account Number (PAN) stands as a tax identification number, compulsory for filing income tax returns (ITR) in India. While PAN can be applied either online or offline, certain rules need to be followed carefully. Some amendments to PAN application forms have been announced recently and shall be effective from 5 December 2018.
Here in this article, we will discuss those compulsory rules which must be followed anyhow.
Beside filing income tax return, PAN is also mandatory for transactions such as opening of a bank account, depositing cash exceeding Rs 50,000 into a bank account, opening a demat account, investment in shares/ mutual funds, and immovable property transactions.
Application for PAN is to be made in Form 49A for Indian nationals and Form 49AA for foreign nationals. The recent decision of Supreme Court confirms that Aadhaar is mandatory for filing of ITR and allotment of PAN. Form 49A, therefore, requires one to furnish the Aadhaar number/ Enrolment ID of an Aadhaar application. It is essential for one to link their Aadhaar with PAN as this facilitates e-verification of the tax return filed through a simple online process.
Please note that foreign nationals, non-resident individuals as per the Indian tax laws, super senior citizens, individuals residing in the states of Jammu & Kashmir, Assam and Meghalaya are not required to quote Aadhaar in the PAN application form and the tax return.
The new PAN rule states that choice to the applicant on whether the name of father or mother needs to be displayed on the PAN Card. Further, where the applicant’s mother is a single parent, quoting of father’s name in PAN application forms will not be mandatory.
The PAN amendment also mentions that a resident person other than an individual who enters into a financial transaction of an amount aggregating to Rs 250,000 or more in a financial year, shall apply for a PAN on or before 31 May of the immediately following financial year.
Also, as per the new rule, tax authorities have been authorized to specify formats and standards for verification of documents filed with the PAN application / intimation of Aadhaar number, for ensuring secure capture and transmission of the data.
The tax authorities are also responsible for evolving and implementing appropriate security, archival and retrieval policies in relation to furnishing of the application forms for allotment of permanent account number/intimation of Aadhaar number. As per the latest amendment, these have now been extended to the issue of Permanent Account Number as well.