The central government announced the launch of PAN 2.0 on Monday, November 25. Electronics and IT Minister Ashwini Vaishnav said- 'The new PAN 2.0 will come with QR code facility.'
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When more than 78 crore population in India has PAN card, then what is the need to bring new PAN 2.0. Is the Central Government going to spend Rs 1,432 crore just because of QR code?
What impact will PAN 2.0 have on the people of India and what problems will arise from not getting a new card made? Today's explainer is on this topic…
First of all let us know what is PAN card… Permanent Account Number i.e. PAN card is a 10 digit number which is issued by the Income Tax Department. PAN card is a very important document for all Indians. It is also used in financial matters along with identity card.
Question 1: What is PAN 2.0 and why was it launched? answer: Indian Income Tax Department has launched version 2.0 of PAN card. This is the updated version of PAN 1.0. Till now the PAN card introduced in 1972 was being used, but now the use of PAN 2.0 will be made mandatory. Making changes to PAN 1.0, PAN 2.0 has been launched.
On November 25 (Monday), the Central Government approved a budget of Rs 1,435 crore for the PAN 2.0 scheme. The central government wants to improve security through PAN 2.0. Therefore, new and more secure technology protocol features have been added to PAN 2.0. Ashwini Vaishnav told-
There were security flaws in the old PAN card, due to which cases of fraud were increasing. Identity theft from a person's PAN card had also started increasing. At present, the software used to operate PAN card is 15 to 20 years old. Many times problems arise due to these software. Therefore, the system will be prepared digitally in the new PAN card. With the help of the new system, PAN card will work like a universal ID.
Union Minister Ashwini Vaishnav during the launch of PAN 2.0.
Question 2: What will be new in PAN 2.0 and what will be its benefits? answer: According to Ajay Kedia, Director of Kedia Advisory, PAN 2.0 will be completely different from the old PAN card. It has been designed to manage finance and taxpayers' data by linking it to Aadhaar card. Let us understand this from 4 points…
1. Digitalization of PAN card The biggest feature of PAN 2.0 is that it will be digitalized. In simple language, physical card of PAN 2.0 will not be available. Its digital card will be made. This will prevent PAN card fraud.
2. Security feature of QR code QR code feature has been added to PAN 2.0. This can also be understood as a digital signature. The name and PAN number of the PAN card holder will be hidden in the QR code. By scanning this code with a smartphone or any scanning device, it will be easy to verify the PAN card.
3. Linking to Aadhar Card It will become mandatory to link PAN 2.0 with Aadhar card. If you already have a PAN card link, then it will have to be updated with the new card. This will enable easy identification of taxpayers and will help in preventing income tax evasion.
4. Advanced Technology Infrastructure PAN 2.0 will help the Income Tax Department system better. This will reduce the use of paper documents and the investigation process will also speed up through digitalization. It will be used in government schemes, financial transactions and as an official document.
Question 3: Will a new application have to be made for PAN 2.0 and will it be free? answer: According to Ajay Kedia, if you already have a PAN card, then you do not need to make a new application for PAN 2.0. You just have to link PAN with Aadhaar card, because the Income Tax Department has made Aadhaar linking mandatory. To link PAN card, you have to visit the Income Tax website. incometaxindiaefilling.gov.in You will have to log in.
You can also link PAN card through SMS. For this you should have mobile number linked to Aadhar card and PAN. For example you UIDPAN
At the same time, if you do not already have a PAN card, then you will have to go to the Income Tax Website and make a new application. This process will be completely free. You will not have to pay any charge for this. After applying, you will get a new digital PAN card under PAN 2.0. It will have other new facilities including Aadhaar linking.
Question 4: How to get PAN 2.0 and where will it be stored? answer: After PAN 2.0 is created, it can be downloaded from the Income Tax website. You can also download it from the official websites of UTIITSL and NSDL. It will be downloaded in PDF format. You can save it on your phone or computer. This card will be completely valid and can be used in any official process. The data of PAN 2.0 will be stored in the database of the Income Tax Department.
Question 5: Will the old PAN card be closed? answer: According to Ashwini Vaishnav, the old PAN will not be closed. Until a new card is made, work will continue to be done with the old card. After the creation of PAN 2.0, use of the new card will become mandatory.
No change will be made in the PAN number on updating the old PAN card. That means your PAN number will remain the same, but if you are making a PAN card for the first time, then you will be given a new PAN number along with the new PAN 2.0.
Union Minister Ashwini Vaishnav said that 'old PAN cards will not be closed until the new PAN 2.0 is made.'
Question 6: What will be the benefit to taxpayers from PAN 2.0? answer: According to senior chartered accountant Rajesh Jain, there will be 5 benefits to taxpayers from PAN 2.0…
- PAN 2.0 will transform the registration technology of taxpayers and make it more technology driven. This will bring many benefits to the taxpayers.
- After PAN 2.0, it will become easier for taxpayers to register with the Income Tax Department. Taxpayers will have to complete the verification process at only one place. After this the details will be secured online in the form of data.
- Under this, taxpayers' data will be available at one place. After PAN 2.0 the possibility of getting wrong information will reduce. Along with this, the government will bring PAN Vault system, through which PAN information can be more secured.
- The 10 digit unique number of PAN card will be hidden in the QR code. To get the details of any taxpayer, you just have to scan the QR code. In such a situation, paperwork for taxpayers will be reduced in all finance related issues.
- The government will also launch a portal under PAN 2.0. In this, any tax related complaint can be resolved quickly. Apart from this, it will be a unified portal to which all government portals will be linked.
Question 7: PAN 2.0 was launched under the Common Business Identify Mission, what is this? answer: Common Business Identifier Mission or CBI was first introduced by Finance Minister Nirmala Sitharaman during the Budget Speech 2023. The objective of CBI is to simplify the way of doing business in India. Under this mission, any business started in India is given a unique identification number. So that all types of tax, legal and financial transactions can be managed for him.
Finance Minister Nirmala Sitharaman announcing the Common Business Identifier Mission during the Budget 2023 speech.
PAN 2.0 has been launched under the Common Business Identifier mission. Till now, PAN, TAN and TIN number were issued separately for any company. Managing it was a difficult task for the Income Tax Department. Therefore, now after PAN 2.0, only one unique ID will be issued, which will contain the information of PAN, TAN and TIN.
Question 8: What will happen if PAN 2.0 is not made? answer: According to Ajay Kedia, if you do not get PAN 2.0 made, it may have some disadvantages. If you have an old PAN card and you have not linked it to Aadhaar, then the problem can increase further.
- Old PAN card can be closed.
- There may be problems in income tax return filing and financial transactions.
- You will not be able to use PAN card for foreign travel or job.
- Banking transactions, loan applications, credit card applications and other work will not happen.
- There will be a risk of PAN card fraud or forgery.
- You will not get the benefit of government schemes and subsidies.
- Not having PAN 2.0 may lead to financial and legal problems.
Question 9: How many types of PAN cards are there? answer: According to Rajesh Jain, there are 11 types of PAN cards. Different types of PAN cards are issued to an institution depending on its profile. Whereas individuals get PAN cards on the basis of their citizenship. These are divided according to the alpha digit present on the PAN card.
- P category PAN card is given to common people. This type of PAN card is issued to an individual resident in India. This type of PAN card is used to provide information about the economic activity of that person.
- HUF category PAN cards are given to Hindu Undivided Families. This includes Hindu, Jain or Sikh families. Where there is more than one earning person and everyone supports the same family.
- While issuing PAN card to a company, C category is given. For any company to start business in India, it is mandatory to obtain C category PAN card. A company gets a unique identity through PAN card.
- F category PAN card is issued for partnership firms. This PAN card is given when more than one person registers a firm.
- PAN card is also issued for government departments in the country. For this there are G category PAN cards. It is also called Government Entities PAN Card. This is given to the government departments that register with the Income Tax Department.
- T category PAN card is given to charitable organizations or trusts. Trusts working for religious, charitable or other public purposes come under T category. The Trust is officially identified through T category PAN card. Along with this, the financial transactions of the trust are also monitored.
- A category PAN cards are given to the association. If we understand association in simple language, it is formed by more than two people or companies for the purpose of business.
- B category PAN card is issued for body of individuals. Body of individuals is formed by more than two people together. Companies are not involved in this.
- L category PAN card is given to local authorities. Local authority i.e. municipality or municipal corporation is called. L category PAN card is issued to track their financial transactions.
- Limited Liability Partnership also gets F category PAN card. It is given when more than one person forms a company under Limited Liability Partnership.
- A person gets J category PAN card only if he does not fall in the remaining 10 categories.
Apart from this, PAN cards are also issued to foreign citizens and foreign companies. They have to apply through Form 49AA.
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Research cooperation- Shishir Aggarwal
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