A Permanent Account Number (PAN) is a unique 10-digit alphanumeric code issued by the Income Tax Department of India to every taxpayer. This number serves as an essential identification for all financial transactions and tax-related activities in the country. Each individual or entity can hold only one PAN card according to the law. However, there might be circumstances where you need to deactivate or reactivate your PAN card. This guide will walk you through the steps to either activate or deactivate your PAN card, ensuring you navigate the process smoothly.

Why You Might Need to Activate or Deactivate Your PAN Card

Deactivation Scenarios

Multiple PAN Cards: If you possess multiple PAN cards, it is illegal and advisable to deactivate the extras to avoid penalties.

Foreign Nationals: Foreigners who have PAN cards but no longer need to engage in financial transactions in India should deactivate their PAN cards to prevent misuse.

Deceased Individuals: The PAN card of a deceased person should be deactivated by their heirs to prevent fraudulent activities.

Fake PAN Cards: Any PAN cards found to be obtained using fake documents will be deactivated by the Income Tax Department.

Activation Scenarios

Accidental Deactivation: Sometimes, genuine PAN cards might be deactivated by the Income Tax Department due to administrative errors or duplicate PAN card issues.

Inactive PAN: If your PAN card becomes inactive due to non-use or other reasons, you will need to reactivate it to continue financial transactions.

How to Activate Your PAN Card

If your PAN card has been deactivated, it can disrupt your ability to perform various financial transactions, such as making cash transactions above ₹50,000, filing Income Tax Returns (ITRs), and logging into the e-Filing website. To reactivate your PAN card, follow these steps:

Step-by-Step Process

Write a Letter: Draft a letter addressing the Assessing Officer (AO) requesting the reactivation of your deactivated PAN card.

Attach Required Documents: Include a self-attested copy of the deactivated PAN card along with the letter.

Fill the Indemnity Bond: Complete an indemnity bond in favor of the Income Tax Department, which states that you will be responsible for any misuse of the PAN card.

Submit Income Tax Returns: Attach copies of the Income Tax Returns filed using the deactivated PAN for the past three years.

Visit the IT Department Office: Submit the letter and all enclosed documents to the regional Income Tax Department office.

Processing Time: It typically takes around 15 days for the Income Tax Department to process the request and reactivate the PAN card.

How to Deactivate Your PAN Card

If you need to deactivate your PAN card, you can do so online through a hassle-free process. Here are the steps:

Online Deactivation Process

Visit the NSDL Portal: Go to the NSDL portal for PAN applications.

Select Application Type: Choose “Changes or Correction in existing PAN Data” from the “Application Type” section.

Submit the Application: Fill out the application form and note the generated “Token Number.”

Complete the Form: Continue filling the form but avoid selecting any ticking boxes, which are for making changes in PAN data.

E-Sign the Form: Submit the form and e-Sign it using Aadhaar (optional).

Retain a PAN: Mention the PAN number you want to retain in the designated section.

List PANs to Surrender: Specify any PAN cards you wish to surrender.

Make the Payment: Pay the applicable fee online using a debit/credit card or net banking.

Submit Application: Download and print the submitted application for future reference. If you opt for the paperless method, e-Sign using the Aadhaar OTP method. If not, send the printed application to NSDL, noting “Application for PAN Cancellation” on the envelope.

Reasons for PAN Card Deactivation

The Income Tax Department may deactivate PAN cards for several reasons:

Duplicate/Multiple PAN Cards: An individual might accidentally or intentionally hold multiple PAN cards.

Fake PAN Cards: PAN cards issued based on fake documents are periodically deactivated.

PAN Card Deactivation for Foreigners: Foreign nationals who no longer need to conduct financial transactions in India may surrender their PAN cards.

Deceased Individuals: The PAN cards of deceased individuals are deactivated upon submission of a formal application and the death certificate.

Checking PAN Card Status

To check whether your PAN card is active or deactivated, follow these steps:

Visit the e-Filing Website: Go to the Income Tax Department’s e-Filing website.

Verify PAN: Click on “Verify your PAN.”

Enter Details: Provide the PAN, full name, date of birth, and mobile number, then click on “Continue.”

View Status: The status of your PAN will be displayed on the screen.

If your PAN is deactivated, you can follow the reactivation process mentioned above.

Preventing PAN Card Deactivation

To avoid unnecessary deactivation of your PAN card, consider these preventive measures:

File ITRs Annually: Ensure you file your Income Tax Returns every year.

Link PAN with Aadhaar: Linking your PAN card with Aadhaar is now mandatory and helps maintain its active status.

Regular Checks: Periodically log in to the e-Filing website to check your PAN card status.

Conclusion

Whether you need to deactivate or reactivate your PAN card, understanding the process is crucial for maintaining smooth financial transactions and compliance with tax regulations. By following the outlined steps, you can ensure that your PAN card remains active and valid, or deactivate it if it is no longer needed. Regularly monitoring your PAN card status and adhering to preventive measures will help avoid any disruptions in your financial activities.