New PAN Card Rules To Come Into Effect From 5 December: Click For Details
To cut the numbers of tax evasions as previously recorded the Indian government that is the Income Tax department has decided to introduce a new set of PAN card rules starting the effect from 5 December. The department has made it mandatory for all entities doing business worth over Rs 2.5 lakh in a financial year to have a Permanent Account Number, said CBDT in a notification earlier this week.
According to a new notification issued by the Central Board of Direct Taxes, these businesses need to apply for a PAN card till May 31 of the next financial year. The new rules will become applicable from December 5, said the CBDT notification.
Here are a few things you need to know about new PAN card rules:
-“In the case of a person, being a resident, other than an individual, which enters into a financial transaction of an amount aggregating to two lakh fifty thousand rupees or more in a financial year and which has not been allotted any permanent account number, on or before the 31st day of May immediately following such financial year,” says the new amendment in Income Tax rules, 1962.
-The new income tax rule is not meant for individual taxpayers who are not associated with such entities.
-The new I-T department notification mentions that in case individuals are the managing director, director, partner, trustee, author, founder, karta, chief executive officer or office-bearer of such entities so they too need to apply for a PAN card, within 31 May of the next financial year.
-In the case of a person, who is the managing director, director, partner, trustee, author, founder, karta, chief executive officer, principal officer or office-bearer of the person referred to in clause (v) or any person competent to act on behalf of the person referred to in clause (v) and who has not been allotted any permanent account number, on or before the 31st day of May immediately following the financial year in which the person referred to in clause (v) enters into financial transaction specified therein.
-Now resident entities shall have to obtain PAN even if the total sales or turnover or gross receipts are not or are not likely to exceed Rs 5 lakh in a financial year. In another development, the Income Tax authorities have made it optional for individual taxpayers to give their Father’s name in PAN card application forms for those with single parents.If a PAN applicant’s father is deceased or separated, he or she can choose not to mention father’s name at all in the form.
-The Income Tax Department also announced certain changes to the application form for PAN. It amended the income tax rules and said that quoting of father’s name in PAN application forms would not be mandatory in certain cases. The amended rules provide that furnishing of father’s name will not be mandatory for a person whose mother is a single parent.