PAN needed for transactions worth more than Rs.1 lakh

According to Indian tax laws, it is mandatory to quote PAN for any transaction with value of above Rs.1 lakh


For a non-resident Indian (NRI), what does income accrued in India mean?

—Piyali Dutta

Any income that is sourced from India is considered as income accrued in India. This broadly covers the following types of income:

(i) Profits from sale of goods and services in India;

(ii) Rental income from a house situated in India;

(iii) Interest income from a bank account in India;

(iv) Capital gains made on transfer of any property situated in India;

(v) Salary received for services rendered in India irrespective of where it is received; and

(vi) Income, in any other manner, whose source is in India.

I have a rupee fixed deposit in my bank account in India where the interest is credited to my savings account. Do I need to file a return for this interest income despite the fact that the bank already deducts tax at source (TDS)?

—Karthik Ghosh

It is mandatory for an individual to file her income tax return if her total income before claiming deductions under sections 80C to 80U of the Income-tax Act, 1961, (which would include investment made in Public Provident Fund, life insurance contributions, interest on education loan, donation made to specified charitable institutions, and others) exceeds Rs.2.5 lakh in a given financial year (FY). This limit is Rs.3 lakh for senior citizens (60-80 years) and Rs.5 lakh for super senior citizens (above 80 years).

However, in case total income (before claiming deductions under sections 80C to 80U) in India does not exceed the limits specified above, the individual is not required to file her Indian tax return. But if taxes deducted at source are more than the actual tax liability, an income tax return must be filed to claim tax refund.

I have been an NRI for the past 20 years and I wish to purchase an apartment in India. Do I need to have a Permanent Account Number (PAN) for this purpose?

—Faisal Khan

According to Indian tax laws, it is mandatory to quote PAN for any transaction with value of above Rs.1 lakh. Accordingly, to purchase a property whose value is in excess of Rs.1 lakh, it is mandatory for any person, irrespective of her residential status in India, to obtain a PAN and quote the same while making the purchase.

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