PAN Card Eligibility

A PAN card is one of the must-have documents for every tax-paying citizen of the country. It is also important for several financial transactions and investments.

Additionally, both Indian and Foreign entities wishing to conduct business in the country are required to have a PAN card by law. However, the PAN card eligibility criteria and the documents required for its application depends upon the citizenship type of the applicant.

In this blog, let’s take a quick look at the PAN eligibility criteria applicable for different applicant types and the documents each would require for a successful PAN application.

PAN Eligibility and Documents Required for Indian Citizens

The documents required and eligibility criteria for a PAN card application depend on whether the applicant is an individual, association, firm, etc. The basic requirements for each of these conditions are as follows: 

• Individuals: The individual applying for a PAN card should be an Indian citizen with a valid residential address. The applicant should also have a valid date of birth and identity proof.
• Artificial Judicial Person (AJP): Such entities can apply for a PAN by producing address and identity proof in the form of registration certificates or government-issued documents.
• Hindu Undivided Families (HUF): A HUF is considered a separate entity. This means a PAN card can be applied on behalf of a HUF. The Karta (Head) of the family can apply on the family’s behalf by submitting valid identity, age, and address proofs of all the family members. Further, Karta is also required to submit an affidavit stating all the details.
• Association of Persons (AOP): Any registered association can apply for a PAN card by submitting their registration certificate.
• Minors: Minors are also eligible to apply for a PAN card. In fact, it is advised that minors should have valid PAN cards as it is a mandatory document for property nominations. The parents of the minor are required to fill and submit Form 49A on behalf of the applicant. They also need to submit proof of DOB, address, and identity.
• Local Authorities: Local authorities can also apply for a PAN card by submitting a copy of their agreement.
• Mentally Challenged Individuals: Mentally challenged individuals are also eligible to apply for a PAN card. The application and supporting documents need to be submitted by their representatives.
• Companies: Companies with registered addresses in India can apply for a PAN card provided that they are registered with the Registrar of Companies. The applicants need to submit a copy of the registration certificate issued by the Registrar’s office.
• Partnership Firms: Partnership firms registered in India can apply for a PAN card by submitting a copy of their Partnership Deed.
• Limited Liability Partnerships: LLPs require a copy of the registration certificate for the PAN card application.
• Trusts: Registered trusts must submit a copy of their trust deed or a registration certificate for a successful PAN card application.
• Entities with no Office in India: Companies, firms, trust, LLPs, etc., with no registered address in India, can also apply for a PAN card by submitting address and identity proofs. This can be in the form of a registration certificate from their residential country attested by the Indian Embassy. They can also submit a copy of their registration certificate in India from relevant authorities.

PAN Card Eligibility and Documents Required for Foreign Entities

Due to rapid economic and industrial growth, many foreign investors have decided to set up business operations in India. Such individuals/entities will require a PAN card to carry out financial transactions in the country.

Based on the category they come under, the required PAN card documents for foreign individuals/entities are as follows:

• Individuals: Foreign individuals who want to apply for a PAN can do so by submitting relevant addresses and identity documents. This can be their citizen identification number, passport, PIO card, etc.
• Companies: A foreign company can apply for a PAN card by submitting the company registration certificate from their residential country. This document needs to be attested by the Indian embassy in that country. If that is not present, companies can also submit a copy of the registration certificate issued in India.
• Trusts/Associations/Firms: Trusts, associations, and firms can apply for a PAN card by submitting a copy of their registration certificate from their residential country. This document should be attested by the Indian embassy or consulate in that country.

Why is a PAN Card Necessary?

Given below are some of the situations in which it is necessary to have a valid PAN card:

• A PAN card aids in filing income tax returns.
• It acts as a government-issued proof of identity.
• It is one of the mandatory documents to open a bank account.
• It is required to apply for credit cards and bank loans.
• PAN details are mandatory while selling or buying properties worth more than Rs. 5 lakh in value.
• Any payments made to restaurants exceeding Rs. 25,000 need to be supported with PAN details.
• PAN card details need to be submitted when bank deposits exceed Rs. 50,000.
• PAN details are required for the sale or purchase of any 4-wheeler vehicle.
• Details need to be submitted for investment purchases of more than Rs. 50,000.

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