What is the Importance and Meaning of the Pan Card?
PAN full form is a permanent account number and is a unique code allocated to the taxpayers in India. The Central Board of Direct Taxes supervises PAN. PAN is considered a national identify proof and is mandatory for all professionals or salaried people.
Pan is also considered an essential document while opening a bank account. The Pan number remains unaffected irrespective of any change of address. Indian nationals can obtain this national document without any fees, but an individual can only possess one card.
Structure of a Pan Card
Pan is a unique identifier and consists of 10 alphanumeric entities. It is a mandatory document for Indian nationals under the Income Tax Act of 1961. The two authorities that are allowed to issue plans are UTI Infrastructure Technology and Services Limited and NSDL e-Governance Infrastructure Limited. The structure of Pan card is as follows:
AAAKL1324X – Here, the first 5 characters are letters, next four numerals, and the last character is again a letter.
The first three characters of Pan are sequence from AAA to ZZZ
The fourth character signals the status of the taxpayer
A – Association of persons
B – Body of Individuals
C – Company
F – Firm
G – Government
H – HUF (Hindu Undivided Family
L – Local Authority
J – Artificial Judicial person
P – individual
T – AOP (Trust)
The fifth Character has the first character of Pan holder's last name in the case of an individual. In the case of non-individuals, the 5th character represents the first character of the pan holders' name.
Next four characters are sequential numbers from 0001 to 9999
The last character is an alphabetic check digit
Documents Required for Pan
Permanent Account Number (PAN abbreviation) requires proof of address and proof of identity as mandatory documents. Normally it requires an Aadhar card, voter ID, driving license, electrical bill, partnership deed, company registration certificate, passport, among others.
Things you need to keep in mind while filling up Pan application
Write in capital letters
All the fields are mandatory
You need a compulsory mobile number
The form can be filled up in English/Hindi or regional language
Sign your name clearly during self-attestation
Incorrect documentation is liable for rejection
Why is a Pan Card Important?
Pan Card is a mandatory and important document for Indians. It is important to have Pan if your income is more than Rs 50,000.
Pan card acts as the identity proof
An essential document for tax payments
Tracks and keeps the record of tax payments
You can get connections to electricity, LPG, internet by flashing your pan card
Pan numbers being unique it’s difficult to evade tax
Important to have Pan to purchase mutual fund shares
Jewelry purchase of more than Rs 5 lakh requires pan card
If you want to transfer money out of the country, you would require Pan card
Sale & purchase of vehicle except for two-wheeler
Purchasing insurance policy of more than Rs 50,000
Making payments to hotels amounting to Rs 25,000 and more
Essential to have a Pan card while submitting direct taxes
1. Can I Download my PAN Card Online?
No, you can’t download your Pan card. You can, of course, view your pan card online by logging to the income tax website and selecting the option to know your pan.
2. What is the Full Form of PAN?
PAN stands for the permanent account number and contains a 10 digits alphanumeric combination issued by the Income Tax department. It is issued under the Income Tax Department Act of 1961, subsection 139A.
3. Is a Pan Card Important?
The importance of the Pan card is right next to the Aadhar card. Pan card helps authorities to catch tax evasions and is considered a mandatory document for any income above Rs 50,000.
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