Transactions / Documents which requires PAN compulsorily
As per Rule 114B of the Income Tax Rules, every person shall quote his PAN in all documents pertaining to the transactions specified below:
Transactions which requires PAN compulsorily
PAN should be quoted on all:
1) Sale or purchase of a motor vehicle or vehicle other than two wheeled vehicles.
2) Opening an account [other than a time-deposit referred at point No. 12 and a Basic Savings Bank Deposit Account] with a banking company or a co-operative bank
3) Making an application for issue of a credit or debit card.
4) Opening of a Demat account with a depository, participant, custodian of securities or any other person with SEBI
5) Payment in cash of an amount exceeding Rs. 50,000 to a hotel or restaurant against bill at any one time.
6) Payment in cash of an amount exceeding Rs. 50,000 in connection with travel to any foreign country or payment for purchase of any foreign currency at any one time.
7) Payment of an amount exceeding Rs. 50,000 to a Mutual Fund for purchase of its units
8) Payment of an amount exceeding Rs. 50,000 to a company or an institution for acquiring debentures or bonds issued by it.
9) Payment of an amount exceeding Rs. 50,000 to the Reserve Bank of India for acquiring bonds issued by it.
10) Deposits of cash exceeding Rs. 50,000 during any one day with a banking company or a co-operative bank.
11) Payment in cash for an amount exceeding Rs. 50,000 during any one day for purchase of bank drafts or pay orders or banker's cheques from a banking company or a co-operative bank.
12) A time deposit of amount exceeding Rs. 50,000 or aggregating to more than Rs. 5 lakh during a financial year with -
a. a banking company or a co-operative bank
b. a Post Office;
c. a Nidhi referred to in section 406 of the Companies Act, 2013 or
d. a non-banking financial company
13) Payment in cash or by way of a bank draft or pay order or banker's cheque of an amount aggregating to more than Rs. 50,000 in a financial year. for one or more pre-paid payment instruments, as defined in the policy guidelines for issuance and operation of pre-paid payment instruments issued by Reserve Bank of India under section 18 of the Payment and Settlement Systems Act, 2007 to a banking company or a co-operative bank or to any other company or institution.
14) Payment of an amount aggregating to more than Rs. 50,000 in a financial year as life insurance premium to an insurer
15) A contract for sale or purchase of securities (other than shares) for amount exceeding Rs. 1 lakh per transaction
16) Sale or purchase, by any person, of shares of a company not listed in a recognised stock exchange for amount exceeding Rs. 1 lakh per transaction.
17) Sale or purchase of any immovable property for an amount exceeding Rs. 10 lakh or valued by stamp valuation authority referred to in section 50C of the Act at an amount exceeding ten lakh rupees.
18) Sale or purchase of goods or services of any nature other than those specified above for an amount exceeding Rs. 2 lakh per transaction.
Who has to obtain PAN?
PAN is to be obtained by following persons:
ü Every person if his total income or the total income of any other person in respect of which he is assessable during the previous year exceeds the maximum amount which is not chargeable to tax.
ü A charitable trust who is required to furnish return under Section 139(4A)
ü Every person who is carrying on any business or profession whose total sale, turnover, or gross receipts are or is likely to exceed five lakh rupees in any previous year
ü Every importer/exporter who is required to obtain Import Export code
ü Every person who is entitled to receive any sum/income after deduction of tax at source
ü Any person who is liable to pay excise duty or a producer or manufacturer of excisable goods or a registered person of a private warehouse in which excisable goods are stored and an authorized agent of such person
ü Persons who issue invoices under Rule 57AE requiring registration under Central Excise Rules, 1944
ü A person who is liable to pay the service tax and his agent
ü Persons registered under the Central Sales Tax Act or the general sales tax law of the relevant state or union territory
ü Every person who intends to enter into specified financial transactions in which quoting of PAN is mandatory
A person not covered in any of the above can voluntarily apply for PAN.