What is the Eligibility Criteria for PAN Card?

Permanent Account Number or PAN is a unique identification number assigned to all taxpayers in India. It is an electronic system that records all tax-related information for a person or company. As the data is stored against a single number, no two taxpayers can have a similar PAN.

Furthermore, individuals or companies need to consider PAN card eligibility, age, and the required documents, prior to application. Read on to know more in detail.

As per the Government of India, entities indulging in numerous transactions need to obtain a PAN card. To do so, they must know everything about the eligibility criteria for a PAN card. Given below are some of the Indian citizens who can own PAN upon fulfilling certain requirements –

• Individuals: A person who is an Indian citizen can apply for a PAN card. They need to submit some essential documents like valid identity proof, proof of date of birth, and address proof. (To know more about the acceptable documents, you need to visit the official website of NSDL).
• Hindu Undivided Family: Being a separate entity, a PAN card application needs to be initiated in the HUF's name to facilitate financial transactions. By presenting PAN card eligible documents like proof of identity, address and date of birth, the head of the family can apply for PAN on behalf of his family. Apart from providing his personal details, he must submit his father's name and the addresses of the HUF's co-parceners. Further, the head of HUF must also provide an affidavit mentioning all the details.
• Minors: The minimum age to apply for a PAN card is 18 years. However, parents or guardians of individuals below 18 can also apply for PAN on their behalf. A Permanent Account Number becomes a mandatory requirement for a minor in case they are a nominee for a property and if their parents plan to make investments in their names. During form submission, a minor's guardian must submit their respective documents besides the child's birth proof. Additionally, a minor's Aadhaar number needs to be mentioned in the application form.

Note: There is no maximum age limit for PAN card applications.

• Mentally retarded individuals: A mentally retarded person can also obtain a PAN card. Representatives of such individuals can apply on their behalf.
• Artificial judicial person: These individuals can apply for PAN after furnishing their registration certificate or Government establishing identity and address.

If you fall under any of the above categories, learn about the PAN card eligibility, age, and the necessary documents and use Form 49A to proceed with your application.

Indian companies, trusts, partnership firms etc., can also obtain a Permanent Account Number upon fulfilling specific eligibility criteria. Here is a list of entities who are eligible to possess a PAN card –

• Partnership firm: These firms require submitting a copy of the registration certificate, which is given by the Registrar of Firms or their partnership deed to obtain a PAN card.
• Limited Liability Partnership (LLP): LLPs can proceed with the PAN application only after furnishing a copy of the registration certificate that the Registrar of LLPs issues.
• Trusts: For a successful PAN card application, trusts need to submit their Certificate and Deed of registration number, which is issued by the charity commissioner.
• Companies: Indian companies can now apply for PAN online. Before application, they need to register with the State Registrar of Companies, as furnishing the registration number is mandatory. Along with the form, they need to submit a copy of the registration certificate, which is provided by the Registrar of Companies.
• Local authorities: Local authorities must present a copy of the agreement during application to possess a PAN card.
• Association of persons: Registered associations must submit a copy of their registration certificate for PAN card application.

Now that you have known the PAN eligibility details for Indian citizens and companies, let's look at the criteria for foreign citizens.

Foreign citizens who intend to do any financial transaction in India must mandatorily apply for a PAN card by furnishing valid proofs. They should fill up Form 49AA after going through the PAN card eligibility, age, and documentation details. 

The documents necessary for PAN application are stated below –

Proof of Identity

As identity proof, foreign individuals should consider furnishing these documents –

• Passport or PIO (Person of Indian Origin) or OCI (Overseas Citizen of India) card.
• The taxpayer Identification Number (TIN) or Citizen Identification Number (CIN). Additionally, you can get the attestation from the country's consulate or an authorised official of an overseas Indian scheduled bank branch.

Other than this, a foreign citizen must submit a few documents as address proof.

Proof of Residence

Given below are some of the documents one need to present as proof of address –

• OCI or PIO or passport.
• The Ministry of External Affairs or the Indian Embassy approved and attested TIN or CIN. Applicants can get their attestation from their residing country's consulate or an overseas located branch of the Indian scheduled bank's authorised official. 
• Bank account statement.
• Non-Resident External (NRE) account statement.
• Certificate showing the foreign individual's residential status or permit or residence provided by police authorities.
• A registration certificate containing an Indian residential address issued by the Foreigner's Registration Office.
• Copy of visa grant or a contract or letter of appointment.
• Also, one can produce a letter issued by an Indian employer in original as an address proof.

Apart from this, there are separate factors concerning foreign companies. Feel free to refer to the following section to know more!

Similar to foreign citizens, foreign companies, LLPs and other organisations can also obtain a PAN card by using Form 49AA and attaching a set of eligible documents. Here are the set of documents they need to provide along with the PAN application form –

• Copy of registration certificate issued outside India, attested by the Apostille or Indian Embassy, or High Commission, or consulate of the residing country.
• Registration certificate copy issued in India or copy of approval by Indian Authorities to set up an office in the country.

Further, it is important to note that a PAN card is not mandatory for everyone.

The Income Tax Department uses this 10-digit alphanumeric Permanent Account Number to keep track of an individual or company's financial transactions like tax payments, ITR, TDS or TCS credits, correspondence etc.

However, obtaining a PAN card is not mandatory for certain entities. The ones who do not need PAN are as follows –

• Minors who are not liable to pay income tax can quote their parent's or guardian's PAN card.
• Non-Residential Indians do not require a PAN card for specific transactions.
• Individuals who do not have a taxable income need not apply for PAN. In case of transactions like buying mutual funds, they can present Form 60 that states their income is below the taxable limit and they do not own a PAN card.

Also, note that anyone not meeting the given criteria for PAN card eligibility, age, and other factors will be unable to qualify for this document.

Here are some of the reasons why a PAN card is important – 

• For filing Income Tax Returns.
• Used as identity proof. 
• While opening a bank and depository account. 
• During credit card and bank loan applications. 
• To sell or purchase immovable property worth ₹5 lakh or more valuation. 
• During restaurant payments exceeding ₹25,000.
• While depositing ₹50,000 or more in a bank account.
• Purchasing or selling a car or any other vehicle except a two-wheeler. 
• Investment worth ₹50,000 or more.
• While purchasing jewellery after the prescribed limit.

Therefore, from the above pointers, obtaining a PAN card holds importance in a taxpayer's life.