Quoting of father's name in PAN application forms will not be mandatory in cases where mother of the applicant is a single parent, the Income Tax department said on Tuesday. The income tax rules were amended by the Central Board of Direct Taxes (CBDT) through a notification, which said the application forms would give an option to the applicant as to whether mother is a single parent and if the applicant wishes to furnish the name of mother only.
Furnishing the father’s name for the allotment of Permanent Account Number (PAN) is mandatory as per the current rule.
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The Income Tax addressed the concerns of those whose mother is a single parent, said Nangia Advisors LLP Partner Suraj Nangia. It would want to get their mother’s name printed on PAN cards instead of the estranged/ deceased father, he added.
The notification has also made it mandatory for entities that have made financial transactions worth Rs 2.5 lakh or more in a financial year to apply for a PAN card. The application has to be filed on or before May 31 of the assessment year for which such income is assessable.
The new rules would come into effect from December 5.
The resident entities now shall have to obtain PAN even if the total sales/ turnover/ gross receipts are not or are not likely to exceed Rs 5 lakh in a financial year, Nangia said.
“This will help the income tax department track financial transaction, broaden its tax base and prevent tax evasion," Nangia added.
Listed below are the changes in PAN application by the Income Tax department
1. The Income Tax department had received several representations seeking relaxation in the rules regarding the father’s name in the PAN application.
2. According to the current rule, furnishing the father’s name is mandatory for the allotment of PAN.
3. Beginning December 5, the application forms will provide an option to the applicant as to whether the mother is a single parent and if the applicant wishes to furnish the name of the mother only.
4. The amended rules would bring relief to the applicants whose mother is a single parent.
5. The IT rules for specifying the timeline for making an application for allotment of PAN by certain persons and issuance of PAN has also been amended. The application has to be filed on or before May 31 of the assessment year for which such income is assessable.