Why We Need PAN Card?

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Why We Need PAN Card?

Posted by Kareem Thursday, May 23, 2013 0 comments

What is a PAN?

A PAN (Permanent Account Number) is a unique 10 digit alphanumeric number issued by Income Tax department in the form of card. The PAN card is unaffected by change of address and Every person can have only one PAN card. The PAN card also act as an ID Proof. You require a PAN card for each and every financial transaction so that it indirectly allows you to pay the Taxes ..

Structure of a PAN?

PAN 10 digit number structure is based upon the " Phonetic Soundex Code Algoritham" so that each and every PAN number is unique.

1. The first 5 characters are letters called called as core field by using this only system automatically generates PAN Number.

2. In the core field first three characters are series of letters from AAA to ZZZ .

3. The 4th character in the core field must be any one from the following depending upon status.

A----------------------------- Association of Persons(AOP)

B----------------------------- Body of Individuals(BOI)

C----------------------------- Company

F----------------------------- Firm

G---------------------------- Government

H---------------------------- Hindu Undivided Family(HUI)

J------------------------------ Judicial Person

L ---------------------------- Local Authority

P------------------------------- Person

T------------------------------ Trust (AOP)

4. The 5th character of the PAN card is the first character of your surname or last name.

5. 6th character to 9th characters are in the series running from 0001 to 9999.

6. The last character is an alphabetic check digit...

What is the use of PAN Card?

1. For opening a bank account.

2. Making a deposit by cheque/DD/Cash over 50,000 in bank or post office.

3. Making any purchase or sale of property or vehicles.

4. When ever taking a loan for home/personal/vehicle/other.

5. To open demat account.

6. To pay taxes.

7. For verifying Paypal Account.

You can check my previous post about how to check validity of a PAN card

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