Come December 5, new rules will come into effect for PAN card applicants, with the Income Tax Department changing existing rules to curb cases of tax evasion and fraud. According to a notification by the Central Board of Direct Taxes (CBDT), all business entities which have yearly financial transactions up to Rs.2.5 lakh need to apply for a PAN card.
According to a report by NDTV Profit, any entity (except an individual) which partakes in a financial transaction of Rs.2.5 lakh or more (in a financial year) should apply for a PAN card by May 31, 2019.
The new rules, however, are not applicable to individual taxpayers who are not connected with such business entities.
Individuals directly associated with the functioning of such business entities need to apply for a PAN. This includes members who are either the partner, trustee, founder, director, managing director, office bearer, Karta, or CEO of the business entity.
The new rules also make it mandatory for all resident entities to have a PAN, even if the turnover of the entity is less than Rs.5 lakh.
In addition to these new rules, the IT department has done away with mandatorily mentioning the father’s name in application forms for PAN cards. Individuals whose parents are separated or whose father is no more can choose not to mention the father’s name in the application.
Sources: NDTV Profit, Times Now News
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