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Permanent Account Number

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Permanent Account Number (PAN) in India

Permanent Account Number or PAN is a means of identifying various taxpayers in the country. PAN is a 10-digit unique identification alphanumeric number (containing both alphabets and numbers) assigned to Indians, mostly to those who pay tax.

The PAN system of identification is a computer-based system that assigns unique identification number to every Indian tax paying entity. Through this method, all tax-related information for a person is recorded against a single PAN number which acts as the primary key for storage of information. This is shared across the country and hence no two people on tax paying entities can have the same PAN.

When PAN is allotted to an entity, PAN Card too is given by the Income Tax Department. While PAN is a number, PAN Card is a physical card that has your PAN as well as name, date of birth (DoB), and photograph. Copies of this card can be submitted as proof of identity or DoB.

Your PAN Card is valid for lifetime because it is unaffected by any change in address.

Why Is PAN Important? – Uses and Benefits of Having PAN Card

PAN Card is important for taxpayers as it is necessary for all financial transactions and is used to track the inflow and outflow of your money. It is important when paying income tax, receiving tax refunds, and receiving communication from the Income Tax Department.

The Indian Budget 2019 proposed that individuals who do not have a PAN can use their Aadhaar number to file returns and for any other purpose where PAN was earlier mandatory. This means that if you have not linked your PAN with Aadhaar yet, or do not have a PAN but have an Aadhaar, you don't have to either link PAN and Aadhaar, or apply for a new PAN. However, the rules about this are still in the process of creation/updation/approval.

That said, PAN continues to be necessary for a large number of monetary transactions. PAN Card also serves as a proof of identity. Given below are some of the uses and advantages of having a PAN.