As of May 2010, the Income Tax department in India has made it mandatory for all Indians to have a PAN card (Permanent Account Number), irrespective of their tax filing status.
The PAN is a 10-digit alphanumeric number that is issued in the form of a card. It serves as a universal identification factor for tracking high value transactions and ensures that all financial transactions are in compliance with tax laws, and thus help prevent tax evasions.
Benefits of PAN Cards
- PAN is unique, permanent and national and acts as an ID proof.
- Is unaffected by address change, even between states.
- PAN is a must for depositing Rs.50, 000 or more in any bank.
- Must for operating demat accounts or for opening a bank account.
- For cash payment of a minimum of Rs.50, 000 for buying bankers cheques, bank drafts or pay orders on a single day.
- Selling or buying immovable property worth Rs.5 lakhs or more. If the property is co-owned, the PAN of both owners must be mentioned.
- Sale or purchase of shares, bonds, derivatives, debentures or other securities over Rs.1 lakh.
- An investment exceeding Rs.50, 000 in shares, mutual funds or post office savings.
- Payment of a minimum of Rs.25, 000 against hotel or restaurant bills.
- payment in cash in connection with travel to any foreign country of an amount exceeding twenty-five thousand rupees at any one time.