Come April, no PAN would mean more tax deduction
From April 1, you many end-up paying more tax if you don’t mention your permanent account number (PAN) in the rent receipts you’ve issued to your tenant, reports HT Correspondent.delhi Updated: Jan 21, 2010 00:09 IST
From April 1, you many end-up paying more tax if you don’t mention your permanent account number (PAN) in the rent receipts you’ve issued to your tenant.
If you’ve earned royalties on a book for some innovation, or if you have income from providing consulting services, do not forget to mention your PAN in all transactions, bills and vouchers that you furnish.
The income tax department has made it mandatory to quote PAN in all transactions for which income is deducted at source, failing which tax will be deducted at a flat rate of 20 per cent for the entire income.
The move is aimed at ensuring the individuals make accurate declaration on income earned from various transactions.
“Tax at higher of the prescribed rate or 20 per cent will be deducted on all transactions liable to TDS, where the PAN of the deductee (the person earning income) is not available,” the finance ministry said in a statement on Wednesday.
The new provision will come into effect from April 1, 2010.
All assessees will have to quote their PAN in their correspondences, bills, vouchers and other documents.
“The move will bring in more transparency and accuracy in declaration of income in several transactions such as professional services, rental income or even royalty income,” said
Vikas Vasal, executive director of consulting firm KPMG.
The law will also apply to all non-residents in respect of payments or remittances liable to TDS, the finance ministry statement said.