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In a bid to increase the Permanent Account Number (PAN) penetration in India, finance minister Arun Jaitley launched a two-day camp in October across 43 remote, rural, and semi-urban areas. More such camps can be expected. This initiative is expected to help implement the budget proposal of making PAN mandatory for any cash transactions above the value of ₹1 lakh. It was announced in this year's budget speech that quoting PAN will be a made mandatory for any purchase or sale exceeding ₹1 lakh. However, considering the low penetration of PAN, especially in rural areas, there were concerns about compliance of this rule.
This rule has not come in force yet and as of now, those who do not have PAN can instead submit specified forms-60 and 61. Here is a look at what these forms are and when they can be used.
Where can you use it?
There are certain transactions specified under section 139A of the Income-tax Act, 1961, where PAN is mandatory. These transactions include sale or purchase of any immovable property valued above ₹5 lakh; sale or purchase of motor vehicles that require registration by a registering authority; opening a time deposit of more than ₹50,000 with a bank or post office; payment in cash for a bank draft, pay orders and banker's cheque of an amount more than ₹50,000 in a single day; a contract for sale or purchase of securities of value exceeding ₹10 lakh; and others. PAN is needed for other purposes as well, including to get a telephone (landline or mobile phone) connection, payment of a single hotel or restaurant bill exceeding ₹25,000.
If you do not have a PAN to carry out these specified transactions, you will have to fill either form 60 or 61. Those individuals who do not have a PAN or General Index Register Number (GIRN was issued before PAN had came into existence) should submit Form 60. And if an individual does not have a PAN or a GIRN, and has only agricultural income and no other income chargeable to tax, then she will have to submit Form 61 instead of a copy of PAN.
Other than the specified transactions, you can even use these forms to open a bank account.
Information to be filled
Other than basic details such as your name, transaction for which you are submitting the form, and transaction amount, you will also have to mention details of your income tax return from any assessment year. If you have filed your return, you are required to give details such as ward, circle and range where the last return was filed and for which assessment year it was filed. Further, you will need to state in the form the reason for not having a PAN such as having income below taxable limits.
Along with Form 60 or 61, you will also need to provide a valid residential address proof such as ration card, driver's licence, passport, state utility bills, and so on.
In arrangement with HT Syndication | MINT
This article was originally published on November 05, 2015.
Disclaimer: This content is for information only and should not be considered investment advice or a recommendation.
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