Quoting PAN in several documents has become an indispensable affair.
Starting from opening a bank account to making application for various investment options, quoting of your PAN number is mandatory.
Also Read: 5 easy steps to apply for a PAN Card
Permanent Account Number (PAN) is an important identification number which helps the banks and the financial institutions to keep a track of the authenticity of the user of their services.
There is a barrage of a service provider and service receivers.
A huge amount of money flows in the economy.
Amidst several transactions, PAN provides assurance of the user’s identity and helps the service providers to entrust trust and confidence in their customers.
Rule 114B of the Income Tax Act, 1961 provides the list of transactions wherein quoting PAN is mandatory.
This rule has also undergone few changes which are incorporated below.
Amongst the several areas where Permanent Account Number number is essential, let us know six areas for quoting PAN, which is important for us to know.
- In case of opening of bank accounts. However, in case of opening of basic savings bank deposit account, you do not require to quote PAN.
- In case of hotels/ restaurants bills, payment made in cash exceeding Rs. 50,000/- will require quoting of PAN.
- In case of an application for credit card, to any banking company, the applicant will require to provide the PAN details.
- In case of opening a demat account and for the purchase of shares of the unlisted company for an amount exceeding Rs. 1, 00, 000/- per transaction.
- Previously there was no requirement of purchase or sale of goods or services. However, with the amendments made, purchase or sale of any goods or services exceeding Rs. 2,00,000/- will require your PAN.
- In case of prepaid payment instruments governed by the Payment and Settlement Act such as mobile wallets, the customer will require to quote the Permanent Account Number for the aggregate amount of more than Rs. 50,000/-
Apart from the above-mentioned areas where quoting of PAN is mandatory, the following two areas no more require your Permanent Account Number
- Prior to the amendment, in case of installing a telephone or taking a SIM card, you were required to provide the PAN details. Now, this requirement is aborted.
- In case of deposit exceeding Rs. 50,000/- with the savings bank account quoting of PAN was mandatory. Now, this requirement is also done away with.
Apart from the above-mentioned areas, do visit the income tax site to know more about the other areas which require you to quote your PAN.
Also, do not quote a wrong Permanent Account Number (PAN) because this may delay the processing of your transactions.
Next time when your service provider asks you for your PAN number you will be well aware of the areas which mandatorily require it.
By staying informed, you will be prevented from the delay in the processing of any transactions.