Module 5 6 Direct Tax - II - PPTs

Amity College of Commerce & Finance
ACCF
B.Com.(H.), Semester 4
Direct Tax – II
Module 5 & 6
Dr. Adarsh Arora
1
Module -5 & 6
Overview of Taxation – PAN, TAN, E-filing of income tax return,
ITR forms, & TDS
& Recent developments in Taxation – Form 16 & Form 26AS
2
• PAN stands for Permanent Account Number. A PAN

number is a ten-digit number in alphabets and numerical, or
in 'alphanumeric' terms, that is allocated by the income tax
department to all the taxpayers, and is unique with each
individual.
• A PAN number helps the authorities keep track of the
financial activities of any individual, as PAN is integral to all
forms of payments.
• A PAN number is allotted through a laminated card, which is
called a PAN card. A PAN card contains information like
PAN number, Name, DOB, and father’s name.
3
To get a PAN card, taxpayers can enrol themselves online. A

PAN card can be made online through the following steps:
Go to the official website of NSDL or UTIISL.
On the website, look out for PAN card form or Form 49 and fill
out the personal details.
After filling the details, upload the required documents.
Pay the online processing fee, which is ₹ 93.
After the successful completion of the form, the PAN card is
delivered to the submitted address within 15 days.
4
PAN Card
5
A permanent account number (PAN) is a ten-character

alphanumeric identifier, issued in the form of a laminated
"PAN card", by the Indian Income Tax Department, to any
"person" who applies for it or to whom the department allots
the number without an application. It can also be obtained in
the form of a PDF file.
6
A PAN is a unique identifier issued to all judicial entities

identifiable under the Indian Income Tax Act, 1961. The income
tax PAN and its linked card are issued under Section 139A of
the Income Tax Act. It is issued by the Indian Income Tax
Department under the supervision of the Central Board for
Direct Taxes (CBDT) and it also serves as an important proof of
identification.
It is also issued to foreign nationals (such as investors) subject
to a valid visa, and hence a PAN card is not acceptable as proof
of Indian citizenship. A PAN is necessary for filing income tax
returns.
7
The PAN (or PAN number) is a ten-character long alpha-

numeric unique identifier.
The PAN structure is as follows: Fourth character [P —
Individual or Person ] Example: AAAPZ1234C
The first five characters are letters (in uppercase by default),
followed by four numerals, and the last (tenth) character is a
letter.
The first three characters of the code are three letters forming
a sequence of alphabets letters from AAA to ZZZ
The fourth character identifies the type of holder of the card.
Each holder type is uniquely defined by a letter from the list
below:
8
A — Association of persons (AOP)

B — Body of individuals (BOI)
C — Company
F — Firm
G — Government
H — HUF (Hindu undivided family)
L — Local authority
J — Artificial juridical person
P — Individual or Person
T — Trust (AOP)
•The fifth character of the PAN is the first character of either:
•of the surname or last name of the person, in the case of a "personal" PAN card, where the fourth character is "P" or
•of the name of the entity, trust, society, or organisation in the case of a company/HUF/firm/AOP/trust/BOI/local authority/
•artificial judicial person/government, where the fourth character is "C", "H", "F", "A", "T", "B", "L", "J", "G".
•The last (tenth) character is an alphabetic digit used as a check-sum to verify the validity of that current code.
9
TAN or Tax Deduction and Collection Account Number is a 10

digit alpha numeric number required to be obtained by all
persons who are responsible for deducting or collecting tax.
Under Section 203A of the Income Tax Act, 1961, it is
mandatory to quote Tax Deduction Account Number (TAN)
allotted by the Income Tax Department (ITD) on all TDS returns.
Since last few years ITD has revised the structure of TAN. It is a
unique 10 digit alphanumeric code. Accordingly, they have
issued TAN in this new format to all existing TAN holders.
To facilitate deductors find their new TAN, ITD has now
introduced a search facility in their website
(www.incometaxindia.gov.in).
10
Through this facility deductors can search on their name and

old TAN to find the new TAN. Deductors are advised to find
the new TAN from this site before it is incorporated in their e-
TDS return file to avoid any inconvenience at the time of
furnishing e-TDS return.
TAN is required to be quoted in all TDS/TCS returns, all
TDS/TCS payment challans and all TDS/TCS certificates to
be issued. TDS/TCS returns will not be accepted if TAN is not
quoted and challans for TDS/TCS payments will not be
accepted by banks. Failure to apply for TAN or not quoting
the same in the specified documents attracts a penalty
of ₹10,000
11
Practice Questions
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C = 515000
30% on lottery income of Rs. 50000 = 15000 tax
Balance of income = 515000 – 50000 = 465000
Tax liability =
First 25000 = nil
Remaining 215000 x 5% = 10750
+ 30% of tax on lottery = 15000
Gross tax liability = 25750
less rebate 87A = 12500
Balance of tax = 13250
Add – 4%HEC = 530
Net tax liability = 13780
Less – 30% tax on lottery paid as TDS already = 15000
Refund of tax = 1220
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Amity College of Commerce & Finance

& Recent developments in Taxation – Form 16 & Form 26AS

• PAN stands for Permanent Account Number. A PAN

To get a PAN card, taxpayers can enrol themselves online. A

A permanent account number (PAN) is a ten-character

A PAN is a unique identifier issued to all judicial entities

The PAN (or PAN number) is a ten-character long alpha-

A — Association of persons (AOP)

TAN or Tax Deduction and Collection Account Number is a 10

Through this facility deductors can search on their name and

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