Why PAN CARD should be taken even if you are not earning income
This is one of the most common questions asked by many citizens. It is not necessary to make a PAN card only if you are having taxable income or if you are earning. Even if you don’t want to file the income tax return or are not earning enough, still you can still get a PAN card. Rather, it is advisable to get the PAN card for the following reasons:
- Opening a New Bank Account:
If you want to open a new bank account in any bank, then a PAN card may be submitted as identity proof. Though now with Aadhar only, the bank account can be opened but it is still advisable to link the PAN. Without linking the PAN, certain high value transactions could not be carried out in the bank. - For TDS deduction:
PAN number is required to get TDS deduction from your income. According to income tax rules, a taxpayer has to pay tax on his income, which is called TDS. If you make income from freelance work, rent, interest, commission, salary or contractor, then you have to pay TDS. If your earnings are not taxable, you can claim this deduction again by filing your return. However, it is necessary to have a PAN to file the return. If the PAN is not furnished to the payer then the TDS would be done at a higher rate of even 20%.
| - Term Insurance Plan
If anyone wishes to have a term Insurance Plan of 1 crore or more then PAN will be required. Along with this, if you pay the installment of life insurance and it is more than 50,000/_ then also the PAN would be mandatory. - For Investment in Mutual Funds:
If you want to start investing in mutual funds or stock market then you cannot do it without PAN. M/F companies stock Stock Brokers first ask you for your PAN number.
- For Cash Deposit
If you want to deposit more than 50 thousand cash in a bank account, then a PAN card is required. At the same time, if the bill in the hotel comes above Rs 25,000, then also a PAN card is required.
- While Starting a New Business
If you are going to start a new business then you must have a PAN card. Without this you will not be able to complete the necessary paperwork
- To avail Government Schemes
If anyone wants to take advantage of any government scheme, then PAN will be required there too. PAN has been made mandatory in most of the government departments.
- Free-Lance Work
Free-lance work is on the rise in recent times. If you do translation or content work sitting at home, then the company from which you will take this work will definitely ask for a PAN.
Apart from this, PAN is also required in other contract work, and the company does not pay bills without PAN.
- For taking GST Registration
Without the PAN, the GST registration cannot be allotted. It may be noted that the PAN is a GST based number and so PAN is needed for GST Registration as well.
- For Opening Demat A/c
Without the PAN, the demat account also cannot be opened. PAN is asked for while opening the demat account as well.
