PAN And Its Significance

What is PAN?

PAN also known as Permanent Account Number is an identification for all Indian citizen who pays income tax. The pan number consists of 10 alphanumeric characters. PAN card is issued under Indian Income Tax Act 1961 by the Indian Income Tax Department. In a PAN card the PAN number appears as ADCKJ5163G. The PAN card can also be used as a photo identification proof, as there is a passport size picture of the person to whom the PAN card has been issued.

Importance of PAN -

PAN is important for most of the financial transactions. The first and foremost purpose of the PAN is to identify all financial transactions, which means all the monetary transactions can be tracked and observed through PAN. Any financial discrepancies can be easily tracked down with the help of PAN.

The PAN is a unique number just like the IP address of a computer or like the mobile number. The PAN can never be the same for 2 or more individuals. A PAN number can never be the same for two individuals.

How does a PAN card look like?

The shape of the PAN is basically like a plastic debit or credit card. It is basically rectangular in shape. It is light blue in colour, very easy to carry in a wallet. The PAN consists of a passport size photo of the card holder along with the DOB and the date of issue of the PAN card. The address of the card holder is not mentioned in the PAN card. There is an added security feature which is basically a hologram sticker. Previously the PAN card used to be black and white but these days the appearance of the PAN card has improved with better finishing touches.

How to apply for a PAN card?

An individual can apply for a PAN card online with the help of an online form 49A. In various scenarios it has been seen that an individual can also apply for a PAN card through a trustworthy Agent or from the Company where the individual is working.

Usage of PAN -

PAN card is of utmost importance while filling Income Tax returns or any tax deductions. PAN is also mandatory these days while filling up KYC form in Banks. It is also needed while applying for new bank accounts. All in all it has become a necessity for every individual who is an earning member of the society.

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