Importance of PAN Card for NRI and Indian Residents
A document that is directly linked with the financial transactions of an individual is the Permanent Account Number (PAN), one of the most important documents at present issued by the Income Tax Department. In order to prevent tax evasion by individuals and entities, this card is linked to all financial transactions made by a particular individual or entity.
Mostly, a PAN is used for filling out an ITR. It is mandatory for every individual or tax payer who needs to file an income tax return. Including the foreign citizens, entities, and NRIs who are earning taxable income in India, they too are required to obtain a PAN card number.
The PAN details are essential to opening a demat account. Though a PAN card is not required while filing an Aadhaar Card Application, it is mandatory to link a PAN with Aadhaar if the person wants to file his income tax return.
The main objective of Permanent Account Number is to use a universal identification number to track the financial transactions of every individual earning taxable income in India and to prevent tax evasion. If we talk about the use of a PAN card other than in filling out the ITR, then it will be important to mention here that at present, while purchasing any property, opening a new account at the bank, purchasing shares, buying a new car, making insurance payments, etc., all of these require the availability of the Permanent Account Number.
Know More: Permanent Account Number for NRI/PIO?