In a bid to widen the tax base, the Finance Minister Arun Jaitley, while pronouncing the Union Budget 2018 introduced a provision mandating Permanent Account Number (PAN) for all the financial transactions over Two lakh Fifty Thousand rupees.
The provision is applicable with effect from 1st April 2018.
The 10-digit Permanent Account Number (PAN) would be used as Unique Entity Number for non-individuals, said the memorandum to the Finance Bill 2018.
“It is proposed that every person, not being an individual, which enters into a financial transaction of an amount aggregating to Rs2.50 lakh or more in a financial year shall be required to apply to the assessing officer for allotment of PAN,” it said.
Besides, in order to link the financial transactions with individuals, the finance bill has also proposed that the managing director, director, partner, trustee, CEO, founder or any person competent to act on behalf of such entities shall also apply to the assessing officer for allotment of PAN.