INVESTOR EDUCATION SERIES:
QUOTING PAN WILL HELP IN LESSER TDS ON YOUR INTEREST ON DEPOSITS
It has become mandatory for term deposit holders to quote their PAN(permanent account number) with effect from April 1, 2010. This has becomemade compulsory by the Income Tax Department, Government of India as perUnion Budget announcement on July 6th, 2009.If any deposit account holder does not submit his/her PAN number to the bank/financial institution/company concerned before April 1st, 2010; tax will bededucted at source (TDS) from that date on the interest to be paid by theseorganisations to the deposit holders at much higher rate of 20 per cent or more.
Till now, one can avoid TDS by submitting Form 15-H (for Senior Citizens of age65 years or more-Income Tax Act defines a senior citizen as a person of 65 yearsor more) or Form 15-G (for persons below the age of 65 years) as the case may beto post office/bank. This form may be given at the time of deposit itself. This willundergo a radical change wef April 1, 2010 as stated above. As such, it is advisable for all (who keep term deposits in banks, financialinstitutions, NBFCs or companies) to apply for PAN and submit the same to the bank/company concerned. If the PAN number is not quoted; all interest payment would be subjected to TDS at much higher rate of 20 per cent or more wef April 1,2010.
PAN application can be obtained from:
OR, 2. www.utitsl.co.in OR,
3. www.nsdl.com PAN application can be made online through the websites of UTITSL or NSDL. Andpayment of fee can be made by credit card or cheque or demand draft. This is for the benefit of all the deposit holders concerned and general public. with regards, Rama Krishna VadlamudiBOMBAYDate: January 3, 2010