Our Team assist Non-Resident’s in Obtaining PAN (Permanent Account Number), Applying for the PAN Corrections, and PAN Surrender along with Other Income Tax matters.
Some of the basic question with respect to PAN of the 'Non-resident Indian' is discussed below.
How to determine that an Individual is NRI?
'Non-resident Indian' is an individual who is a citizen of India or a person of Indian origin and who is not a resident of India.
Thus, in order to determine whether an Individual is a non-resident Indian or not, his residential status is required to be determined under Section 6.
As per section 6 of the Income-tax Act, an individual is said to be non-resident in India if he is not a resident in India and an individual is deemed to be resident in India in any previous year if he satisfies any of the following conditions:
However, condition No. 2 does not apply where an individual being citizen of India or a person of Indian origin, who being outside India, comes on a visit to India during the previous year.
A person shall be deemed to be of Indian origin if he, or either of his parents or any of his grand-parents, was born in undivided India.
When Non-Resident is Required to Obtain PAN?
Every person being a Non-Resident who is required to file or intend file Voluntarily, the Income Tax Returns or Whose Total Income during a financial year exceeds Rs. 2,50,000 or wish to carry out a transaction for which the quoting of PAN is compulsory as per Rule 114B of Income Tax Rules 1962 or wishes to carry out any business whose turnover likely to exceed Rs.5 Lakhs or person who is required to obtain “Import Export Code”, or Person who is entitled to receive any sum/income after TDS required to obtain PAN
What is the utility of PAN?
PAN enables the department to link all transactions of the assessee with the department. These transactions include tax payments, TDS/TCS credits, returns of income, specified transactions, correspondence and so on. It facilitates easy retrieval of information of assessee and matching of various investments, borrowings and other business activities of assessee.
A Permanent Account Number has been made compulsory for every transaction with the Income-tax Department. It is also mandatory for numerous other financial transactions such as the opening of bank accounts, deposit of cash in bank account, opening of DEMAT account, transaction of immovable properties, dealing in securities, etc. A PAN card is a valuable means of photo identification accepted by all Government and non-Government institutions in the country.
Further if TDS is deducted or Taxes are Withheld by any entity for the Income generated by Non-Resident’s in India, the excess Amount after payment of the Income Tax on the Income generated by Non-Resident’s in India, can be obtained as a refund after filing Income Tax returns.
Is it mandatory to file return of income after getting PAN?
Return is to be filed only if you are liable to file return of income under section 139. It is not mandatory to file return of income after getting PAN
What are the specified financial transactions in which quoting of PAN is mandatory?
Following are the transactions in which quoting of PAN is mandatory by every person except the Central Government, the State Governments and the Consular Offices: