What is the full form of PAN?
The full form of PAN is Permanent Account Number. Permanent Account Number (PAN) is a computer-based electronic system that assigns a unique 10 digit alphanumeric number being issued by the income tax department to identify taxpayers in India. PAN consists of both alphabetic and numeric digits.
PAN card comes in a tangible form with the unique PAN number allotted, including the Name of the entity, DOB, photograph, which can be even submitted as proof of identity, and also as a document for many other regulatory requirements.
Format of PAN Card
The PAN card format contains information related to the applicant like the name, DOB, as commensurate with the KYC guidelines. PAN card has the following details:
- Name Name of the applicant
- Father’s Name: Name of the applicant’s father
- DOB: Date of Birth of the applicant, in case of other than individuals, the date of registration with the appropriate authority
- PAN Number: Out of the 10 digit number first 5 characters are alphabetic series, out of which the first 3 characters stand from AAA to ZZZ
Pan Card Number Format
For example, “ABCPRXXXXC”
Out of the first five characters, the first three characters represent the alphabetic series running from AAA to ZZZ. The fourth character of the PAN represents the status of the PAN holder.
“P” stands for Individual
“C” stands for Company
“H” stands for Hindu Undivided Family (HUF)
“A” stands for Association of Persons (AOP)
“B” stands for Body of Individuals (BOI)
“G” stands for Government Agency
“J” stands for Artificial Juridical Person
“L” stands for Local Authority
“F” stands for Firm/ Limited Liability Partnership
“T” stands for Trust
The fifth character of PAN represents the first character of the PAN holder’s last name/surname in the case of an individual. In the case of non-individual PAN holders, the fifth character represents the first character of the PAN holder’s name. The next four characters are sequential numbers running from 0001 to 9999.
The last character, i.e., the tenth character is an alphabetic check digit.
Utility of PAN
PAN enables the income tax department to identify/ link all transactions of the PAN holder with the department. These transactions include tax payments, TDS/TCS credits, returns of income, specified transactions, correspondence, etc, and so on. It facilitates easy retrieval of information of PAN holders and matching of various investments, borrowings, and other business activities of PAN holders.
Eligibility for PAN Card
The following are the eligibility criteria for owning PAN numbers.
- Individuals: In case of individuals applying for PAN number, they should be a citizen of India with a valid address and date of birth and ID proof. The proof to substantiate the ID could be a driver’s license, passport, Aadhar card or voters card, etc
- Hindu Undivided Families: The head of the family who is also known as Karta in the case of Hindu Undivided Family, could apply for a PAN number on behalf of other members of the family by providing ID proof such as address proof, date of birth of the members of the HUF
- Minors: In the minors’ cases, the guardians could apply for the PAN number on their behalf by providing their ID proofs
- NRI: In the case of citizens living outside India, they can apply for the PAN number by providing a bank statement of the country in which he/she currently resides as the address proof
- Corporate: Companies applying for the PAN numbers should be registered with the ROC (Registrars of Companies) and should provide the registration certificate as ID proof
- Partnerships/Firms: Limited liability firms or partnerships should be registered with the relevant authority to get the PAN number and provide a copy of registration as ID proof
- AOP: Association of a person registered with appropriate authority can get the PAN number by providing their registration certificate
- Artificial Judicial Person: Artificial judicial persons can apply for the PAN numbers by providing the relevant registered certificate or documents
- Trust: Trust can apply for the PAN number by providing the certificate of deed or the registered certificate
Types of PAN
Following are the different types of PAN:
- Hindu Undivided Family (HUF)
- Corporation / Company
- Artificial Judicial Person
- Limited Liability Partnerships/ Firm
- Association of person
Why do we need a PAN Number?
PAN card number is required for various reasons. The following are the major reasons which make the PAN numbers necessary.
- PAN number is required to file an Income Tax return.
- PAN number is required as proof of identity.
- PAN number is required to open any Bank account or depository account.
- To apply for a bank loan or any credit card, a PAN number is an essential requirement
- To purchase or sale of a property having a valuation above 5 lakhs, a PAN number is necessary
- To shell out a bill above Rs.25,000 PAN number is required
- PAN number is required if someone is depositing the amount Rs 50,000 or above in the Bank account
- PAN number is also called for to purchase and sale of a car or any other vehicle
- PAN number is required in case of an investment of Rs 50,000 and above
- PAN number is required in the purchase transaction of jewelry above the prescribed limit
How to apply for PAN?
Follow these steps to apply for a PAN card online in India:
- You can apply for a PAN card online either via NSDL or UTITSL websites. Both have been authorized to issue PAN cards in India. For this tutorial, we will show you how to apply for a PAN card via the NSDL website.
- On the page linked in the previous step, you will see a form titled Online PAN application. Under Application, Type select New PAN – Indian Citizen (Form 49A). If you’re a foreign national, select New PAN – Foreign Citizen (Form 49AA).
- Select the category of PAN card you need. For most people, this will be Individual.
- Now fill in your details such as name, date of birth, mobile number, etc., enter the captcha code, and click Submit.