ALERT! Here are 3 new PAN rules effective from today that you must know

The Permanent Account Number aka PAN is a crucial financial document that you must acquire in order to open a bank account or a Demat account, to file Income Tax Returns (ITR) and even for trading fixed assets.

The Central Board of Direct Taxes (CBDT) had last month concluded to further introduce 3 vital rules which will not only effect individuals but resident persons/entities associated with Hindu Undivided Family (HUF), firms, company, charitable trusts, association of persons, body of individuals, a local authority, etc.(Image: PTI)

New Delhi: Three New PAN rules will come into effect from today i.e. 5^th December 2018 onwards. The Permanent Account Number aka PAN is a crucial financial document that you must acquire in order to open a bank account or a Demat account, to file Income Tax Returns (ITR) and even for trading fixed assets. You also need to furnish PAN details for depositing cash above Rs.50,000 in a bank account. The past year has seen a lot of amendments in regards to PAN and Aadhaar UID, including linking both. The Central Board of Direct Taxes (CBDT) had last month concluded to further introduce 3 vital rules which will not only effect individuals but resident persons/entities associated with Hindu Undivided Family (HUF), firms, company, charitable trusts, association of persons, body of individuals, a local authority, etc.

Let’s take a look what these new PAN rules ensue for you:

1. Any resident person including Karta of an HUF, managing director, director, founder, partner, author, chief executive officer, trustee, principal officer or office bearer or a person competent to act on behalf of the person referred to above has to apply for PAN on or before 31^st May of the following financial year in which financial transactions of Rs.250,000 or more were processed. For example, if transactions were undertaken in financial year 2018-19, then the concerned person must apply for a Permanent Account Number on or before 31^st May 2019.
2. Secondly, resident entities must also acquire a Permanent Account Number regardless of whether their turnover, total sales or gross receipts are expected to cross Rs.5 lakh in a financial year or not.
3. Lastly, furnishing father’s name is not mandatory anymore for children of single mothers. Also, an individual can choose to display either father’s or mother’s name on their PAN card, contrary to PAN card’s bearing father’s name only till date.

Furthermore, CBDT has also empowered the Principal Director General/Director General of Income Tax (Systems) to specify the manner in which Permanent Account Number shall be issued, henceforth.