20 transactions in which quoting PAN mandatory
Do you know – What are the transactions where quoting of PAN is mandatory. In this article, you will know list of 20 financial transactions in which pan is compulsory.
PAN is a ten-digit alphanumeric number issued by the Income Tax Department. It stands for Permanent Account Number. It is a very important document for financial and banking transactions.
PAN is a way for the Income Tax department to keep track of financial transactions done by taxpayers.
PAN has many uses. Its use is not restricted to financial and banking transactions only. One can use his PAN card as valid identity proof also.
Uses of PAN Card in India
PAN card is also used to take advantage of various schemes of the government. In this article, we will know all the uses of PAN card in detail.
We will also see where it is mandatory to use PAN. What are the transactions where quoting PAN is mandatory.
According to the Income Tax law, certain transactions have been specified where it is mandatory to provide a copy of the PAN or PAN number.
Those who are not aware of this specified transaction. They must know this. So let us know about the specific transaction where it is mandatory to quote or give PAN number.
Following are the specified transactions where quoting of PAN is mandatory:
Transactions where quoting of PAN is mandatory
1. Opening a Bank account (Savings or Current both) with a bank or a co-operative bank
PAN is also required to open your bank account in the bank. Whether you open your bank savings account or business current account. You will have to give a copy of your PAN to the bank.
2. PAN is required for Sale or Purchase of Motor vehicle
PAN card is also required for the sale or purchase of all motor vehicles except two-wheeler. If you buy a car or four-wheeler, then you will have to give your PAN number or copy of PAN to the car dealer.
3. You need to mention your PAN for Deposit of Cash exceeding Rs.50, 000 during any one day with a bank / co-operative bank
4. Payment to Hotel & Restaurant in Cash exceeding Rs 50,000
PAN card is also needed to pay hotel and restaurant bills.
If you pay Rs. 50,000 or more in cash to a hotel or restaurant against its bill, then you will have to give a copy or number of your PAN card.
5. Payment in cash in connection with Forex purchase & foreign travel
- Cash Payment exceeding Rs 50,000 in connection with travel to any foreign country or for the purchase of any foreign currency at any one time.
6. Applying for a Credit Card or Debit Card
Making an application for the issuance of a credit card or debit card.
Features of PAN Card
7. Opening a Demat Account
Opening of a Demat account with a depository, participant, custodian of securities, or any other person approved by SEBI.
8. PAN for purchase of gold worth Rs,50,000 or above
Quoting of PAN is mandatory on the purchase of gold jewelry or bullion worth Rs.500,000 or above.
9. Purchase of Mutual fund units
PAN number is mandatory if you are making payment of Rs. 50,000 or above to a Mutual Fund for purchase of its units.
10. Mention PAN for Purchase of Debentures or bonds above Rs. 50,000
Payment of an amount exceeding Rs. 50,000 to a company or an institution for acquiring debentures or bonds issued by it.
11. Purchase of bond issued by RBI
Payment an amount exceeding Rs 50,000 for purchase of bond issued by the Reserve Bank of India.
12. 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.
13. A fixed deposit of amount exceeding Rs 50,000 or aggregating to more than Rs 5 lakh during a financial year with- a bank /post-office/co-operative bank / NBFC.
14. 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.
15. Copy of PAN for Payment of life insurance premium to any insurer
Payment of an amount aggregating to more than Rs.50,000 in a financial year as life insurance premium to an insurer.
16. A contract for the sale or purchase of securities (other than shares) for an amount exceeding Rs 100,000 per transaction.
- Sale or purchase of shares of an unlisted* company exceeding Rs 100,000 per transaction
- *company not listed in a recognized stock exchange
18. PAN mandatory for Buying & Selling of Immovable Properties
- Sale or purchase of any immovable property valued above Rs 10 lakh or
- valued by stamp valuation authority referred to in section 50C of the Act at an amount exceeding Rs 10 lakh.
- immovable property include House, flat, Shop, Plot, villa, farmhouse, etc.,
19. Sale or purchase of goods or services of any nature other than those specified above for an amount exceeding Rs 2 lakh per transaction.
20. Permanent Account Number (PAN) is mandatory for Business Registration
Thus, PAN is mandatory for numerous financial transactions such as opening of bank accounts, deposit of cash in bank accounts, opening of a Demat account, transaction of immovable property, dealing in securities, among others.