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Benefits of Permanent Account Number(PAN)

Permanent Account Number (PAN) is unique alphanumeric combination issued to all juristic entities identifiable under the Indian Income Tax Act 1961. Here it describes the benefits of having a Permanent Account Number (PAN), Things to do when you lose a PAN card or when you have 2 PANs.

Benefits of Permanent Account Number(PAN)
 

 

PAN is issued by the Indian Income Tax Department under the supervision of the Central Board for Direct Taxes (CBDT) and is almost equivalent to a national identification number. It also serves as an important ID proof.

PAN structure is as follows: AAAAA9999A: First five characters are letters, next 4 numerals, last character letter. These 10 characters can be divided in five parts as can be seen below. The meaning of each number has been explained further.
Each assesse is uniquely identified by the PAN.
If the PAN does not follow the above structure, then the PAN will be shown invalid.
 
1. First three characters are alphabetic series running from AAA to ZZZ
2. Fourth character of PAN represents the status of the PAN holder.
 
• C — Company
• P — Person
• H — HUF(Hindu Undivided Family)
• F — Firm
• A — Association of Persons (AOP)
• T — AOP (Trust)
• B — Body of Individuals (BOI)
• L — Local Authority
• J — Artificial Juridical Person
• G — Government
 
3. Fifth character represents first character of the PAN holder’s last name/surname.
4. Next four characters are sequential number running from 0001 to 9999.
5. Last character in the PAN is an alphabetic check digit. 
 
Nowadays, the DOI (Date of Issue) of PAN card is mentioned at the right (vertical) hand side of the photo on the PAN card.
 
Click here to know your PAN card information
 
Benefits of obtaining a Permanent Account Number [PAN] and PAN Card
 
A PAN number has been made compulsory for every transaction with the Income Tax department. It is also mandatory for numerous other financial transactions such as 
a) opening of bank accounts
B) availing institutional financial credits
c) purchase of high-end consumer item
d) foreign travel
e) transaction of immovable properties
f) dealing in securities 
g) purchasing of gold etc..
 
 A PAN card is a valuable means of photo identification accepted by all government and non-government institutions in the country.
 
Losing PAN card
If you still remember the PAN number you can continue to transact with the Income Tax department. However, in respect of other agencies you may encounter constraints without a PAN card since it doubles as a photo identity card.
 
Allotment of two PANs
You may retain any one of the numbers and surrender the other through a letter addressed to your jurisdictional Assessing Officer. It is illegal to have two PANs and the penalty for such offence is Rs.10,000/-
 

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