Transactions Where Quoting PAN Is Mandatory in India
Permanent Account Number (PAN) is required for many specified financial transactions in India. The requirement depends on the transaction type, payment method and applicable monetary threshold. This guide explains the categories listed under Rule 114B of the Income-tax Rules, 1962 and the associated limits.
List of transactions requiring PAN
The table sets out the key transactions and the conditions that trigger PAN quotation. "Exceeding" means strictly more than the stated amount, not equal to it.
| Transaction | Description | PAN threshold |
|---|---|---|
| Motor vehicles | Sale or purchase of registrable motor vehicles other than two-wheelers | All such transactions |
| Bank accounts | Opening bank or co-operative bank accounts, excluding specified time deposits and Basic Savings Bank Deposit Accounts | All such account openings |
| Credit and debit cards | Application for a credit or debit card | All applications |
| Demat accounts | Opening a demat account | All openings |
| Hotels and restaurants | Cash payment against one or more bills at one time | Exceeding Rs. 50,000 |
| Foreign travel and currency | Cash payment for foreign travel or foreign currency at one time | Exceeding Rs. 50,000 |
| Mutual funds | Payment for purchase of mutual fund units | Exceeding Rs. 50,000 |
| Debentures and bonds | Payment to a company or institution for debentures or bonds | Exceeding Rs. 50,000 |
| RBI bonds | Payment to the Reserve Bank of India for bonds | Exceeding Rs. 50,000 |
| Cash deposits | Cash deposits with banks, co-operative banks or post offices in one day | Exceeding Rs. 50,000 |
| Bank drafts and pay orders | Cash purchase of bank drafts, pay orders or bankers cheques in one day | Exceeding Rs. 50,000 |
| Time deposits | Deposits with banks, co-operative banks, post offices, Nidhis or eligible NBFCs | Exceeding Rs. 50,000 per deposit or Rs. 5 lakh in a financial year |
| Prepaid payment instruments | Specified cash or bank-instrument payments for prepaid payment instruments | Aggregating to more than Rs. 50,000 in a financial year |
| Life insurance | Life insurance premiums paid to an insurer | Aggregating to more than Rs. 50,000 in a financial year |
| Securities other than shares | Contract for sale or purchase of securities other than shares | Exceeding Rs. 1 lakh per transaction |
| Unlisted shares | Sale or purchase of shares of an unlisted company | Exceeding Rs. 1 lakh per transaction |
| Immovable property | Sale or purchase of immovable property, including stamp valuation criterion | Exceeding Rs. 10 lakh in transaction value or stamp valuation |
| Other goods and services | Sale or purchase of goods or services not covered above | Exceeding Rs. 2 lakh per transaction |
Banking and cash transactions
PAN is generally required for opening specified bank accounts, applying for debit or credit cards, and opening demat accounts irrespective of the transaction amount. For cash deposits and purchases of bank drafts or similar instruments, the daily limits in the table apply. Time deposits are subject to both a single-deposit and financial-year aggregate test.
Property, vehicles and investments
Property purchases or sales exceeding Rs. 10 lakh, including transactions whose stamp-duty valuation exceeds that amount, are covered. Registrable motor vehicles other than two-wheelers are covered without a minimum amount. Mutual fund investments, bonds, securities contracts and unlisted share transactions have their own thresholds as shown above.
Hotel bills, foreign travel and insurance
For hotel or restaurant bills and foreign travel or foreign currency transactions, the Rule 114B threshold specifically refers to cash payments exceeding Rs. 50,000 at one time. Life insurance premiums are covered when aggregate payments exceed Rs. 50,000 during a financial year. Other identification, KYC and reporting obligations may independently apply.
What if you do not have PAN?
Depending on the applicable law, transaction and eligibility, a person without PAN may be required to submit a prescribed declaration rather than quote a PAN. See the guide to Form No. 60 for persons not holding PAN and the procedure for obtaining PAN. Aadhaar may be accepted in place of PAN in circumstances permitted by law, subject to applicable requirements.
Other PAN-related compliance
PAN is also relevant to income-tax returns, tax deduction and collection at source, and specified high-value transactions. Securities market intermediaries may impose additional KYC and PAN requirements. Physical share transfers and transmission of shares to legal heirs are governed by securities and company-law procedures; they should not be treated as separate monetary entries under Rule 114B merely because they appeared in older lists.
Official reference
For the authoritative wording and exceptions, consult the Income Tax Department's Rule 114B - transactions requiring PAN and its PAN and Aadhaar guidance. Rules may be amended; check the latest notified law when completing a transaction.