Don’t you have a PAN card yet? I mean, almost all banks today require your PAN details if you visit them to open a savings account. How come you not have one yet? In accordance with the Income Tax Act, any individual whose annual income exceeds the basic tax exemption limit of Rs. 2 Lakh or a businessman whose turnover for a year exceeds Rs. 5 Lakh must possess a PAN card. Besides, PAN card is mandatory for every individual who owns a house or a property of any kind, holds a fixed deposit account in a post office or a bank, or is a nominee of any kind of investment, such as stocks or any interest generating entity, despite just filing income tax return.
Even if you’ve not started earning yet, you need to have a PAN card since this is going to be some help for you. It is more like a Driving License that doesn’t make driving necessary for you, but you will definitely need it when you’re going to drive.
10 Reasons why PAN card is necessary for every Indian
Despite income tax filing being the primary objective of having a PAN card, there are several other point/times when you need it even if you don’t earn yet.
PAN card, in India, is a valid identification proof and you can display or attach a copy of it in all government and private avenues accompanied by Voter ID card issued by the election commission of India, Aadhaar card etc.
Open a Savings Account in Post Office or a Bank
Reserve Bank of India keeps an eye on every single financial transaction do, and therefore, it requires you to provide your PAN card details for opening a post office or bank savings account. If you’re applying for a Jan Dhan account, you don’t need to provide your PAN card details.
You are going to be asked for your PAN card details at the bank, in case you need to do cash transaction (deposit/withdrawal) of over Rs. 50,000.
In case you’re going abroad or planning a foreign trip in the near future and you need to exchange currency, you will be asked for a copy of your PAN card.
Bank Fixed Deposits
If you have a bank fixed deposit and you’re willing to withdraw your money, your bank will ask you to submit a copy of your PAN card. Failing to produce a copy of your PAN card results in TDS deduction of 20% and not 10%, in case the interest earned is over Rs. 10,000.
All Property Transactions
If you’re selling or registering a property, you need to produce a copy of your PAN card without fail.
If you’re seeking a loan of any kind, you need to submit a copy of your PAN card with the bank/lender.
Hotel/Restaurant Bill Payment in Cash
You will have to provide your PAN card details, in case you need to pay a hotel or restaurant bill of Rs. 25,000 or above in cash.
You must provide your PAN card details if you want to invest in equity, Mutual Funds, etc.
If you’re purchasing gold of Rs. 5 Lakh or above, then will have to provide you PAN details, which is order to monitor gold circulation in India.
If you pay an insurance premium of Rs. 50,000 or more in a year, then you need to provide your PAN details.