Many people wrongly assume that PAN card is only required for taxpayers. But the fact is that PAN card is not only used to file income tax returns, but is also required for various other money transactions conducted at both personal and professional level.
The Income Tax Department, which used to encourage people to get their permanent account numbers, is now making it mandatory for certain transactions.
Listed Below are Some of the Situations Where One Needs to Furnish PAN details Irrespective of their earning potential.
- While opening a bank account: It’s mandatory to furnish details of your PAN card while opening a new account in any bank, post office, and in non-banking financial institutions. However, savings accounts opened under Pradhan Mantri Jan Dhan Yojana (PMJDY), as part of financial inclusion programme, does not require applicant’s PAN card details.
Even the existing account holders are being asked to furnish their PAN card details to the respective banks.
- For bank transactions: For any cash deposit or withdrawal of more than Rs.50,000 a day, submitting PAN details was made compulsory to prevent money laundering.
Other bank transactions such as fixed deposits of more than Rs.50,000, purchasing bank drafts, pay orders and cheques amounting more than Rs.50,000 in a single day also need PAN details. Failure to submit the same would result in tax deduction at source.
- While applying for financial products: If you’re applying for an insurance policy which requires you to pay an yearly annum of Rs.50,000 you have to furnish your PAN card details to the respective insurance company.
PAN card details are also required to processing new loans and credit cards.
- For investments: Any kind of investments in securities such as mutual funds, equities, debentures, or bonds exceeding Rs.50,000 requires PAN card details of the investor.
PAN details are required even when you are selling your securities over and above one lakh.
- For sale and purchase: Not every sale or purchase requires PAN card details but a few still require the same. You need to submit a self-attested copy of your PAN card while buying or selling any vehicle other than two-wheelers.
Similarly, buying or selling any immovable property in India worth more than Rs.10 lakh also required PAN details.
It also applies to goods and services. If an individual makes a purchase or sells goods or services worth more than Rs.2 lakh per transaction, he/she needs to furnish their PAN card details. In India, it is typically observed during the purchase of gold. Gold purchases above Rs.2 lakh needs the purchaser to submit the PAN details to the retailer.
- Foreign travel: If your ticketing expenses to travel abroad exceed Rs.50,000, you need to submit your PAN card details.
- Hotel or restaurant bills above Rs.50,000: Yes, you need to have PAN card to spend more than Rs.50,000 in a hotel or a restaurant. Hence, make sure to carry your card if you’re planning for an expensive stay in a hotel.
To conclude, in addition to all the above, PAN card serves as a legitimate proof of identity anywhere in and outside India. If you haven’t had it till now, don’t you think you should get it immediately after knowing its applications?