Permanent Account Number (PAN)

The Permanent Account Number (PAN) is a unique ten-digit alphanumeric identifier issued by the Income Tax Department (ITD) to individuals, companies, and other entities. It serves as an essential tax identification number for various purposes, including filing income tax returns, deducting tax at source (TDS), and conducting financial transactions.

Applications for PAN

PAN is required for various activities, including:

• Filing income tax returns
• Deducting TDS from payments made to others
• Opening bank accounts
• Investing in mutual funds, stocks, or bonds
• Purchasing or selling immovable properties
• Conducting high-value financial transactions

Eligibility for PAN

PAN can be applied for by individuals, companies, firms, Hindu Undivided Families (HUFs), Limited Liability Partnerships (LLPs), trusts, associations of persons (AOPs), and bodies of individuals (BOIs).

Documents Needed for PAN Application

The documents required for PAN application vary depending on the applicant type. For individuals, common documents include:

• Identity proof (e.g., Aadhaar card, voter ID, passport)
• Address proof (e.g., utility bills, bank statements, property tax receipts)
• Date of birth proof (e.g., birth certificate, school leaving certificate)

For companies and other entities, additional documents may be required, such as incorporation certificates, partnership deeds, or trust deeds.

Impact of PAN on TDS Returns

PAN plays a crucial role in TDS returns. Deductors are required to quote the PAN of the deductee (the person from whom TDS is deducted) while filing TDS returns. This allows the ITD to track and reconcile TDS deductions and ensure proper tax credit to deductees.