Permanent Account Number (PAN) is basically a unique all-India number that serves as a proof of identity of a taxpayer and it helps link all information pertaining to a particular taxpayer (for example, taxes paid, refunds issued, outstanding arrears, income disclosed, and transactions entered) through the computer system. This is intended to track financial transactions of taxpayers and, in turn, prevent tax frauds and evasion.
Why Form 60? – A brief Introduction
As per the income tax provisions, it is mandatory to obtain PAN for a particular category of persons such as persons having income chargeable to tax, persons carrying on business / profession with turnover exceeding specified limit etc. It is also necessary to quote PAN in various documents i.e., income tax return, any correspondence with income tax department, documents pertaining to certain transactions such as sale and purchase of asset etc.
It is possible that a person may not have obtained PAN just because it is not mandatory or he may have applied for PAN but not received it yet. Ideally, the absence of PAN should not bar an individual from making certain transactions or make it challenging for the income tax authorities to track financial transactions to prevent tax evasion/fraud. In such scenarios, Form 60 can be submitted along with relevant supporting documents to carry out the transaction.
What is Form 60? When should Form 60 be furnished?
Form 60 is a document to be filed by an individual or any person (not a company or firm) to carry out financial transactions that mandates quoting of PAN, under either of the following two scenarios:
- Concerned person does not have a PAN i.e., not applied for
- Concerned person has applied for PAN but allotment is pending
Form 60 is acceptable only in the case of scenario (b) in case the total income of a person exceeds the maximum amount that is not taxable in the year of transaction.
When to submit Form 60?
The following table shows the illustrative transactions that mandate quoting of PAN. Further, Form 60 must be furnished for these transactions when a concerned person does not have a PAN or has a pending PAN allotment.
|Nature of transaction||Value of transaction|
|Purchase or sale of any motor vehicle excluding two wheelers||Any value|
|Opening of demat account||Any value|
|Opening an account with any banking institution or bank other than basic savings deposit account/Application to institution or bank or company for debit or credit card||Any value|
|Purchase or sale of an immovable property||value of Rs 10 lakh or above|
|A fixed deposit with any bank/post office/Nidhi/non banking financial company||Amount more than Rs.50,000 or aggregation of more than Rs.5 lakh during any tax year|
|Payment to restaurants or hotels in cash against the bills||Exceeding Rs. 50,000 at one time|
|Payment in connection with travel to any foreign country or payment for purchase of any foreign currency in cash||Exceeding Rs. 50,000 at one time|
|Payment of a life insurance premium||Exceeding Rs.50,000 in a year|
|Sale/purchase of company shares or contract for sale or purchase of securities||Exceeding Rs.1 lakh per transaction|
|Sale or purchase of goods/services other than the above||Exceeding Rs.2 lakh per transaction|
|Payment to a Mutual Fund for purchase of units||Exceeding Rs.50,000|
Transaction entered into by a minor
In case of a minor entering into a transaction requiring PAN, the PAN of the guardian or Form 60 as the case may be must be provided along with the application.
How and to whom one can submit Form 60?
Declaration in Form 60 can be made either in paper form or online. It is to be submitted to the person with whom transaction is being entered into.
Who need not submit Form 60?
Non residents are exempt from quoting of PAN/submission of Form 60 for few of the transactions specified above such as while applying for credit or debit card, payment to restaurants or hotels against bill etc.
Documents to be submitted with Form 60
A copy of the following documents need to be submitted along with Form 60 only under a scenario where PAN has been applied for but allotment is pending. These documents serve as identity proof/address proof in the above mentioned scenario (b) i.e. where PAN is not applied for.
- Aadhar card
- Driving License
- Ration Card
- ID proof from an accredited institution
- Copy of the electricity bill or telephone bill
- Any document issued by Central Government, State Government or any local bodies.
- Any documentary proof related to the address mentioned in the form.
If PAN is applied for and allotment is pending, only proof of submission of application would suffice.
Information required to be filled in the Form
The following information requires to be filled in Form 60:
- Full address and name of declarant
- Particulars related to the transaction for which you are filling the Form 60 For example, if the transaction is relating to opening a savings account with the bank, you need to mention so in Form 60 stating the name of the bank and the transaction amount too. If it is not applicable then you must write N.A.
- In case you are assessed w.r.t income tax, mention the details of the range, circle or ward where you had filed the last return of income.
- You must state your reason for not having a PAN card. If you have applied for it and are yet to receive it, you must mention it in the form.
Also, note that mismatch of the particulars with the supporting documents will lead to cancellation of the form and requires resubmission.
Consequences of wrong declaration
One must be careful before signing the declaration in Form 60 as any false information in the statement may have consequences.
That is, imprisonment from three months to two years along with a fine can be imposed. If the amount involved is greater than Rs.25 lakh, imprisonment from six months to seven years along with a fine can be imposed for false declaration made.