PAN Card Issuance And Application Process
PAN (Permanent Account Number) is a unique 10-digit alphanumeric code on a laminated plastic card. It works as a proof of identity for all tax-paying entities in the country and is mandatory for all high-value transactions. Moreover, PAN is required for filing Income Tax Return (ITR).
So, how are PAN cards issued in India?
Read on to learn how to apply for a PAN card via the online or offline process.
An Overview of PAN Card
A PAN card is a physical document containing a Permanent Account Number unique for every taxpayer. It is an identification number allotted by the Income Tax Department (ITD) to individuals, companies, HUFs (Hindu Undivided Family) or any other entity.
PAN card is mandatory for conducting the simplest of financial transactions such as opening a bank account, receiving salaries or purchasing/selling high-value assets etc. It serves as a universal key to store tax-related information and prevent tax evasion.
PAN card details include the cardholder’s photograph, his/her name, father’s name, date of birth, signature, PAN, date of issue and a hologram sticker. The 10-digit PAN card for non-individuals has a slight difference, such as the name of the entity and date of incorporation.
ABCPS1234D is an example of a PAN with the following structure:
- The first three characters are in a series going from AAA to ZZZ.
- After that, the 4th character refers to the type of taxpayer. For example, P refers to an individual taxpayer, while C refers to a company, and H is a HUF.
- The 5th character is the first letter of the PAN holder’s last name or a company/association’s name.
- Four numbers after this are in a series going from 0001 to 9999.
- The last character, D, is an alphabetic check digit.
Also read: Uses And Benefits of PAN Card
Why Do You Need to Have a PAN Card?
PAN acts as a proof of identity valid anywhere in the country as it has your name, signature, date of birth and photograph. But more importantly, it links all financial transactions with the ITD and facilitates easy retrieval of information related to borrowings, investments and business activities.
This is the reason why it is compulsory to quote PAN for transactions exceeding Rs. 50,000. This includes payment above Rs. 50,000 for hotel bills, travel, deposits, purchasing mutual funds, bonds, etc. You also cannot purchase or sell goods/services above Rs. 2,00,000 without a PAN or transact shares worth more than Rs. 1,00,000.
Having a PAN card is also mandatory for opening a bank account. In addition, you need a PAN to open a Demat account, get debit/credit cards or purchase a motor vehicle. It is used for filing income tax returns, receiving tax refunds, or communications from the ITD.
Operating Model of the PAN
Everything from issuance and delivery to verification and maintenance of PAN cards works on a public-private partnership (PPP) model. This makes sure to maintain efficiency, competency and austerity in the system.
The ITD, under the supervision of the Central Board of Direct Taxes (CBDT), has authorised two entities- NSDL and UTIITSL as the service provider for PAN. These service providers are responsible for processing, collecting and verifying documents, reprinting and other PAN-related processes.
There are various PAN and TIN facilitation centres all over the country to provide easy accessibility for PAN card services. People can also apply for PAN cards online via the official web portal of NSDL and UTIITSL.
How to Apply for a PAN Card Online?
You can apply for a PAN card online at the official website of NSDL/UTI Infrastructure Technology and Services. Follow the given steps to apply for a PAN card on NSDL:
Step 1
Visit the official website of NSDL and click on ‘Apply Online’.
Step 2
Select Form 49AA in ‘Application Type’ if you are an NRI (non-resident Indian) or foreign citizen. Otherwise, select ‘Form 49A for Indian citizens’.
Step 3
Select the taxpayer category and fill in the rest of the information.
Step 4
Click on the checkbox, enter the CAPTCHA code and then click on ‘Submit’.
Step 5
Note down the given token number and click on ‘Continue with PAN Card Application Form’.
Step 6
On the new page, you will have three options to submit your PAN application documents. These are- A) e-KYC and e-sign for completely paperless process, B) Forward documents physically and C) Submit scanned image through e-sign.
Step 7
Fill in your Aadhaar number, full name and a parent’s name (to be printed on PAN card) and click on ‘Next’.
Step 8
On the new page, enter information about your income, residential address and contact details.
Step 9
Type your area code, AO (assessing officer), AO number etc., from the given window.
Step 10
Click on ‘Next’ and upload all supporting documents, photographs and signatures.
Step 11
Now, you will have to make a payment of Rs. 93 (excluding GST) for dispatch of PAN card. For a foreign communication address, one has to pay Rs. 864 excluding GST.
Step 12
After successful payment, an OTP (One Time Password) will be sent to your Aadhaar registered mobile number.
Step 13
Take a printout of the receipt with the acknowledgement number and send it to NSDL’s office within 15 days of the online application.
Also read: How To Check PAN Card Delivery Status?
How to Apply for A PAN Card Offline?
There are TIN facilitation centres and PAN service centres in every major city of India, where you can apply for a PAN card. You will have to submit a PAN application form along with the required documents and fees.
Take the following steps to apply for PAN offline:
Step 1
Collect a PAN card application form (Form 49A or 49AA) from the PAN centre, TIN facilitation centre or a stationary vendor offering such forms.
Step 2
Read all instructions given on the form. Next, fill out this form in block letters (in black ink).
Step 3
Affix two recent colour photographs with white background (3.5 x 2.5 cm). Sign across these photographs so that part of it is on the white paper.
Step 4
Submit copies of relevant documents along with the duly signed application form and fees at any TIN FC or PAN centre.
Also read: How To Submit PAN Grievances?
Final Word
The PAN card is an important document required for basic financial transactions and identification proof. You can apply for a PAN card via online or offline means, though there is no 100% paperless process. You will mandatorily need to have an Aadhaar card to apply for PAN nowadays.
Frequently Asked Questions
How can you check the status of your PAN card application?
You can use the 15-digit acknowledgement number to track your PAN card’s status on NSDL or UTIITSL. To track the status on NSDL, visit the official website, click on ‘Track your PAN’ and enter this number. Then, fill in the CAPTCHA code and click on the ‘Submit’ button.
Is it mandatory for taxpayers to quote PAN for income tax purposes?
No, the Finance Act (No. 2) 2019 stipulates situations where a person may furnish his/her Aadhaar number in place of PAN for high-value transactions. A person who has an Aadhaar card but no PAN and those who have linked Aadhaar number with PAN may use these documents interchangeably.
Is linking Aadhaar with your PAN card mandatory?
Section 139AA stipulates that any person with a PAN who is eligible for an Aadhaar card needs to submit his/her Aadhaar number to the IT Department. If such persons fail to do so within the deadline, their PAN will become inoperable. This would result in them being liable for consequences of not furnishing PAN under Rule 114AAA (2).
Where can you download a PAN card online?
You can download an e-PAN card from the NSDL or the UTIITSL portal. Those who have applied for a new PAN card can download the e-PAN using their acknowledgement number and email/mobile number. Those who already have a PAN card can download the e-PAN using their PAN and date of birth.
What are the legal consequences of owning multiple PAN cards?
No person is allowed to own more than one PAN card. If found, such persons will be liable to pay a Rs. 10,000 penalty under Section 272B of the Income Tax Act for owning multiple PAN cards. If you have more than one PAN card, you should surrender the additional PAN cards.
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This article has been prepared on the basis of internal data, publicly available information and other sources believed to be reliable. The information contained in this article is for general purposes only and not a complete disclosure of every material fact. It should not be construed as investment advice to any party. The article does not warrant the completeness or accuracy of the information, and disclaims all liabilities, losses and damages arising out of the use of this information. Readers shall be fully liable/responsible for any decision taken on the basis of this article.
