Taxman makes PAN card mandatory for all bank accounts
Stepping up the chase for tax dodgers, the government has directed banks to obtain the permanent account number (PAN) or Form-60 if PAN is not available, from all bank account holders by February 28, 2017.
- Jan 9, 2017,
- Updated Jan 9, 2017 10:23 AM IST
Stepping up the chase for tax dodgers, the government has directed banks to obtain the permanent account number (PAN) or Form-60 if PAN is not available, from all bank account holders by February 28, 2017.
Income-tax rules have been amended to provide that banks shall obtain and link PAN or Form No. 60 (where PAN is not available) in all existing bank accounts other than basic savings accounts by February 28, 2017, if not already done, a notification by the Central Board of Direct Taxes (CBDT) stated on Sunday.
Likewise bank account holders who have not submitted PAN or Form No 60 are advised to submit the PAN or Form No 60 to the bank by February 28, 2017, the notification stated.
However, this rule will not apply to Basic Savings Bank Deposit Accounts (BSBDA), which include zero balance savings accounts such as Jan Dhan.
The BSBDA were introduced to take care of simple banking needs of people and come with free ATM card, monthly statement and a cheque book. The crackdown has come amid fears that most of the most of the banned 500 and 1000 rupee notes have made their way to bank accounts several of which are ``benami'' created merely to launder cash. Various estimates suggest that close to Rs 15 lakh crore of the Rs 15.44 lakh crore in high value notes that have been scrapped has been deposited back with banks. The RBI has said it is still in the process of cross-checking the numbers to arrive at a final figure.
Finance Minister Arun Jaitley on Sunday said that just because large quantum of high denominational currency has been deposited with the banks does not render this money to be legitimate cash and the Income Tax Department is entitled to tax this money.
"Black money does not change its colour merely because it is deposited in banks. On the contrary, it loses its anonymity and can now be identified with its owner," the finance minister in a Facebook post titled Demonetisation -- a look back at the last two months.
"In any case, the amendment to the Income Tax Act itself provides that the said money, if voluntarily declared or if involuntarily detected, would be liable for differential and high rates of taxation and penalty," Jaitley added.
Following the note ban, as many as 60 lakh individuals and firms made large deposits totalling a staggering Rs 7 lakh crore in old notes.
Last month, RBI had mandated that no withdrawal shall be allowed from the accounts having substantial credit balance/deposits if PAN or Form No.60 is not provided in respect of such accounts.
It further said that the banks and post offices had also been mandated to submit information in respect of cash deposits from April 1, 2016 to November 8, 2016 in accounts where the cash deposits during the period November 9, 2016 to December 30, 2016 exceed the specified limits.
It has also been provided under the new rules that person who is required to obtain PAN or Form No.60 shall record the PAN/Form.No.60 in all the documents and quote the same in all the reports submitted to the Income-tax Department.
Stepping up the chase for tax dodgers, the government has directed banks to obtain the permanent account number (PAN) or Form-60 if PAN is not available, from all bank account holders by February 28, 2017.
Income-tax rules have been amended to provide that banks shall obtain and link PAN or Form No. 60 (where PAN is not available) in all existing bank accounts other than basic savings accounts by February 28, 2017, if not already done, a notification by the Central Board of Direct Taxes (CBDT) stated on Sunday.
Likewise bank account holders who have not submitted PAN or Form No 60 are advised to submit the PAN or Form No 60 to the bank by February 28, 2017, the notification stated.
However, this rule will not apply to Basic Savings Bank Deposit Accounts (BSBDA), which include zero balance savings accounts such as Jan Dhan.
The BSBDA were introduced to take care of simple banking needs of people and come with free ATM card, monthly statement and a cheque book. The crackdown has come amid fears that most of the most of the banned 500 and 1000 rupee notes have made their way to bank accounts several of which are ``benami'' created merely to launder cash. Various estimates suggest that close to Rs 15 lakh crore of the Rs 15.44 lakh crore in high value notes that have been scrapped has been deposited back with banks. The RBI has said it is still in the process of cross-checking the numbers to arrive at a final figure.
Finance Minister Arun Jaitley on Sunday said that just because large quantum of high denominational currency has been deposited with the banks does not render this money to be legitimate cash and the Income Tax Department is entitled to tax this money.
"Black money does not change its colour merely because it is deposited in banks. On the contrary, it loses its anonymity and can now be identified with its owner," the finance minister in a Facebook post titled Demonetisation -- a look back at the last two months.
"In any case, the amendment to the Income Tax Act itself provides that the said money, if voluntarily declared or if involuntarily detected, would be liable for differential and high rates of taxation and penalty," Jaitley added.
Following the note ban, as many as 60 lakh individuals and firms made large deposits totalling a staggering Rs 7 lakh crore in old notes.
Last month, RBI had mandated that no withdrawal shall be allowed from the accounts having substantial credit balance/deposits if PAN or Form No.60 is not provided in respect of such accounts.
It further said that the banks and post offices had also been mandated to submit information in respect of cash deposits from April 1, 2016 to November 8, 2016 in accounts where the cash deposits during the period November 9, 2016 to December 30, 2016 exceed the specified limits.
It has also been provided under the new rules that person who is required to obtain PAN or Form No.60 shall record the PAN/Form.No.60 in all the documents and quote the same in all the reports submitted to the Income-tax Department.