What are penalties for holding multiple PAN cards or not having PAN card? Know here

For many years, the Permanent Account Number (PAN) has been an essential component of India's financial system. It's how firms and individual taxpayers can participate in significant economic activity while maintaining compliance and transparency. PAN has become to be essential in India's expanding digital economy. Now, the government is giving it a major upgrade with PAN 2.0, a move that aims to improve user-friendliness and equip tax-related services with advanced technology.

 

What is PAN 2.0?
 

Approved with a budget of Rs. 1,435 crore by the Union Cabinet, PAN 2.0 is an ambitious initiative that seeks to modernise PAN and TAN services with advanced e-governance and guarantee quicker and more efficient procedures. By consolidating multiple platforms into a single, unified system, PAN 2.0 offers a smoother, more secure experience for taxpayers.

In order to ensure regulatory compliance and reduce the possibility of people having numerous PANs, the updated system also makes use of improved technology to identify and eliminate duplicate PAN requests.

 

Who needs to obtain PAN?
 

1. Individuals with Taxable Income: A PAN is required for anyone whose total income over the tax-exempt threshold. 

2. Charitable Trusts: A PAN is necessary for trusts that are obligated to file returns in accordance with Section 139(4A) of the Income-tax Act.

3. Business and Professionals: A PAN is required for anyone managing a business or profession with annual gross receipts, sales, or turnover exceeding Rs 5 lakh.

4. Specified Financial Transactions: Individuals intending to enter financial transactions where providing PAN is mandatory need to apply for it.

5. Non-Individuals and Associated Persons: If a non-individual entity's financial transactions exceed Rs 2.5 lakh in a financial year, such as a company or trust, they must register for a PAN. 

 

Penalty for not having PAN Cards
 

Hefty penalties can be incurred for holding numerous PANs, giving false information, or failing to have a PAN card when needed: 

• Penalty for Violations: Section 272B of the Income-tax Act imposes a fine of Rs 10,000 for non-compliance.

• Multiple PANs: No one is permitted to possess several PANs. If someone does, they have to let the jurisdictional evaluating officer know so that the extra PAN can be deleted or deactivated. 

“Under PAN 2.0, advanced mechanisms will prevent duplicate PAN issuance. This enhancement ensures stricter compliance and reduces errors”, says Adhil Shetty, CEO of Bankbazaar.com. 

 

Why PAN 2.0 is a game-changer
 

PAN, a special 10-digit alphanumeric code that connects financial transactions to the Income Tax Department, has existed since 1972. It is used for everything from paying taxes to claiming TDS credits and filing returns.
 

By improving speed, security, and usability, PAN 2.0 carries on this legacy. Its advanced features include:

1. Simplified Services: A complete overhaul of PAN and TAN systems for better efficiency.

2. Unified Platform: A single, simplified interface is being created by combining several portals.

3. Improved Security: Advanced technology to guard against duplicate entries and secure data.

4. Enhanced User Experience: A focus on making the system accessible for everyone.

Shetty says, “India’s digital economy is expanding rapidly, and PAN is a critical enabler of this growth.” He further adds,“PAN 2.0 aligns with the government’s vision of a tech-driven financial ecosystem, ensuring smoother compliance and greater transparency.”