PAN Made Mandatory For Opening All Bank Accounts From January 1

PAN Made Mandatory For Opening All Bank Accounts From January 1

From January 1, quoting PAN or permanent account number will be mandatory for opening all bank accounts, the government announced on Tuesday.

With the aim of checking domestic black money, the government today announced a slew of measures that will make the use of PAN mandatory not just for opening accounts but several other transactions including buying gold or jewellery for Rs 2 lakh or paying a bill of Rs 50,000 at a restaurant.

To reduce bank accounts with forged details, the government has made PAN card mandatory for all kind of bank accounts except those under the Pradhan Mantri Jan Dhan Yojana.

Revenue Secretary Hasmukh Adhia said, "The government is committed to curbing the circulation of black money and widening of tax base. To collect information on certain types of transactions from third parties in a non-intrusive manner, the Income-Tax Rules require quoting of PAN where the transactions exceed a specified limit."

PAN will be mandatory for any transaction of over Rs 2 lakh, regardless of whether it is in cash or through card or cheque. The Finance Minister in his budget speech had proposed a Rs 1 lakh limit.

The Rs 2 lakh limit for disclosure of PAN card is an "interim measure" and ultimate goal is to lower it Rs 1 lakh, Mr Adhia said.

To help small property buyers, monetary limits for quoting PAN has been raised to Rs 10 lakh from Rs 5 lakh for sale or purchase of immovable property. People without a PAN are required to fill a form and furnish a specified document from a list to establish their identity.

In a relief to small investors, the requirement of furnishing PAN for making post office deposit of over Rs 50,000 has been dispensed with.Mr Adhia said the enhanced limits will bring balance between burden of compliance on legitimate transactions and the need to capture information relating to high value transactions.

The move follows the recommendation by the Supreme Court-appointed Special Investigation Team (SIT) on Black Money that quoting of PAN should be made mandatory for all sales and purchase of goods and services where the payment exceeds Rs 1 lakh.

Source:BankingUpdates