PAN Now Mandatory For Opening Bank Accounts

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PAN or Permanent Account Number is made mandatory for opening all bank accounts from 1 January, 2016.

To reduce bank accounts with forged details, the government has made PAN card mandatory for all kind of bank accounts except those under the Pradhan Mantri Jan Dhan Yojana.

current affairsPeople without a PAN are required to fill a form and furnish a specified document from a list to establish their identity.

In a relief to small investors, the requirement of furnishing PAN for making post office deposit of over Rs. 50,000 has been dispensed with.

The enhanced limits will bring balance between burden of compliance on legitimate transactions and the need to capture information relating to high value transactions.

The move follows the recommendation by the Supreme Court-appointed Special Investigation Team (SIT) on Black Money that quoting of PAN should be made mandatory for all sales and purchase of goods and services where the payment exceeds Rs. 1 lakh.

To collect information on certain types of transactions from third parties in a non-intrusive manner, the Income-Tax Rules require quoting of PAN where the transactions exceed a specified limit.

PAN will be mandatory for any transaction of over Rs. 2 lakh, regardless of whether it is in cash or through card or cheque. The Finance Minister in his budget speech had proposed a Rs. 1 lakh limit.

The Rs. 2 lakh limit for disclosure of PAN card is an “interim measure” and ultimate goal is to lower it Rs. 1 lakh.

To help small property buyers, monetary limits for quoting PAN has been raised to Rs. 10 lakh from Rs. 5 lakh for sale or purchase of immovable property.

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