Why is a Pan Card Number compulsory in India?
Have you ever thought why we need a Pan card? The full form of pan is permanent account number and it has become quite important in today’s world especially for the financial transactions. When you get your card you are allotted with a certain number which becomes your identity.
This issue is looked after by the tax department and they are usually responsible for allotting the card as well as the number to a person. Other than identity it is also essential for different kinds of transactions as well as for obtaining information about the person.
Now you need to find out how to apply for the pan. Other than this, you also need to find out when you should apply for it. First of all you should find out the basic exemption limit of your income.
If you find that your income exceeds the limit then it is time to apply for the pan card. It is important to make sure that you apply for the card within the 31st of May of the assessment year. There are lots of people who are completely ignorant about these facts.
They do not know about the importance of pan card and hence they do apply for one. This is the reason why they face different kinds of problems during various transactions. A person whose gross receipts or turnover exceeds 500,000 must surely apply for the pan before the accounting year ends.
Employers who file returns for the fringe benefits usually do not have any set time limit to apply for the pan. There are lots of advantages of getting a pan which you will understand when you get one.
It can be used for identity and is one of the most relevant sources of proving your identity. There are certain things that you need to follow if you want to get a card for yourself.
Other than the employers of the companies, people like exporters, importers and people who apply for the registration under the service tax rules, central excise rules, and sales tax law must also apply for the pan card. You must always remember that you should quote your pan while performing certain transactions. But you must be thinking what kinds of transactions require the pan.
If you buy or sell a property of 500,000 or more then the owner must produce his pan. Other than this, if you purchase or sell a vehicle which will require registration you will have to produce your pan. If your cash payment exceeds Rs 25,000 especially when you are going for a foreign tour you must produce the pan.
You will also require the pan when you deposit Rs 50,000 or more in a bank or even in a post office. Pan is also necessary while opening a bank account as well as during the issue of a credit card.
You will require the pan for almost each and every financial transaction which exceeds the limit. There are certain exceptions where you might do without the pan. But for this you must provide form 60 or 61. This is especially for the agriculturists.
Other than the agriculturist the non resident Indians are also exempted from quoting pan. You must also remember that you need to produce the pan if you receive any amount from a person or company from which tax is deducted.
Other than this, if you are a buyer of goods like timber, alcoholic liquor, scrap, forest produce, tendu leaves then it is important for you to produce your pan to the people with whom you deal. Make sure you do not violate the rules.
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