India: Changes in PAN Rules11 December 2018
India's Income Tax department has put into effect new rules with respect to Permanent Account Number (PAN) from 5 December 2018 to prevent tax evasion and to provide flexibility to taxpayers. Earlier this year in the month of November, the Central Board of Direct Taxes (CBDT) had issued a notification stating the amendments in Income Tax Rules, 1962 to come into effect on 5 December 2018.
The crucial new PAN card rules are given below:
- From now on it is mandatory for a resident person other than an individual such as Hindu Undivided Family (HUF), firm, charitable trusts, association of persons (AOP), body of individuals, company or a local authority who are dealing in financial transactions of more than INR 2.50 lakhs and who has not been allotted any PAN, shall apply for one before 31 May of the next financial year.
- Any person, who is the managing director, director, partner, trustee, author, founder, karta, chief executive officer, principal officer or office bearer of the above mentioned entities or any person competent to act on behalf of such entities and who has not been allotted any PAN, shall apply for the same before 31 May of the financial year following the fiscal in which the entities specified above enter into financial transaction amounting of INR 2.50 lakhs or more.
- Further, from now on mentioning the father’s name in the PAN application will not be mandatory for the applicants whose mother is a single parent. Also, the new application forms i.e. 49A (for Indians) and 49AA (for foreign nationals) will have the option for all applicants to choose whether they want their father’s or mother’s name to be shown on their PAN card. If no option has been selected in the application form, the father’s name will be shown on the PAN card.