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Why quoting PAN is mandatory in specified transactions?


Date: 31 Mar 2016    Group: Finance and Investments    Category: Tax Planning   

It is well known that quoting PAN has been made mandatory in certain specified transactions. What are reasons of this and what are the specified transactions for which quoting PAN is mandatory? What if PAN is not quoted by an individual in such cases?
Experts: do respond.


Wondering why PAN card number needs to be specified in transactions? Find responses from experts here, on this page.


Author: Suresh Kumar R    01 Apr 2016      Member Level: Gold     Points : 2  (Rs 2)    Voting Score: 0

PAN is made mandatory where the transactions exceeds certain limi and the purpose is to curbing / reducing black money and increase the tax collection.

Special Investigation Team formed by Government of India on black money recommended that PAN should be made mandatory where the transactions exceeds 1 lakh and Government of India accepted the recommendation and made PAN mandatory where transaction exceeds 2 Lakhs.


Author: Mahesh    02 Apr 2016      Member Level: Gold     Points : 2  (Rs 2)    Voting Score: 0

PAN is now being used to track the transaction and the money flow by banks. So quoting the PAN in transaction higher than 50K is important. This way you can be sure that the income tax department and banks are cleared on the money flow.

Government wishes to make the flow of money more legal. And this is the reason both domestic and international transactions require PAN quoted. International transaction (remittance) are initiated only after quoting PAN. In case of domestic transaction, you can find that the requirement exists for quoting PAN.


Author: Venkiteswaran.    02 Apr 2016      Member Level: Diamond     Points : 2  (Rs 2)    Voting Score: 0

Income Tax authorities monitor the financial transactions(especially high value) by tracing the PAN. Hence it is made mandatory to quote PAN for every financial transaction involving amount above a particular threshold.

Income Tax authorities now get details and even specific alerts on certain transactions done with banks, NBFC etc by automated systems emanating from various centres.
There is nothing to worry for a person who is dong genuine, permitted transactions and accounts everything correctly on his tax returns and for tax payments.


Author: Karthikeyan    03 Apr 2016      Member Level: Gold     Points : 4  (Rs 4)    Voting Score: 0

PAN, Permanent Account Number is used by income tax department to monitor all the financial transactions by individuals. It helps to monitor irregular financial activity and helps to bring black money out. Government made quoting PAN as mandatory to monitor all the financial activities and tighten the irregular transactions.

Government made quoting PAN as mandatory for below transactions.

1. Any transactions include the transfer of amount Rs 2 lakhs or more.
2. Hotels and Restaurant bill amount more than Rs. 50,000.
3. During opening a bank account.
4. Purchase or sale of immovable properties worth Rs 10 lakhs or more.
5. During opening a term deposit.
6. For bank drafts exceeding Rs. 50,000 in a single day.
7. Opening a demat account.
8. Purchase of mutual fund units more than Rs. 50,000.
9. Purchase of life insurance with a premium of more than Rs. 50,000.

Advantages:
Quoting PAN will ease the monitoring the transactions of individuals or companies by government. It will help the government to bring the black money out from people. It also cut down irregular usage of money for various purpose.





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