PAN Explained

Posted In India - By NitiN Kumar Jain On Friday, May 25th, 2012 With 0 Comments

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Permanent Account Number or PAN is unique alphanumeric combination issued to all juristic entities identifiable under the Indian Income Tax Act 1961. It is issued by the Indian Income Tax Department under the supervision of the Central Board for Direct Taxes (CBDT) and is almost equivalent to a national identification number. It also serves as an important ID proof.

This number is almost mandatory for financial transactions such as opening a bank account, receiving taxable salary or professional fees, sale or purchase of assets above specified limits.

It is not easy to remember an individual PAN but following a simple tactic we can remember it easily. Here it is:

PAN is a 10 digit alpha numeric number, where the first 5 characters are letters, the next 4 numbers and the last one a letter again.

These 10 characters can be divided in five parts as below. If the PAN does not follow the above structure, then the PAN will be shown invalid

  • First three characters are alphabetic series running from AAA to ZZZ
  • Fourth character of PAN represents the status of the PAN holder.

C — Company
P — Person
H — HUF(Hindu Undivided Family)
F — Firm
A — Association of Persons (AOP)
T — AOP (Trust)
B — Body of Individuals (BOI)
L — Local Authority
J — Artificial Juridical Person
G — Government

  • Fifth character represents first character of the PAN holder’s last name/surname.
  • Next four characters are sequential number running from 0001 to 9999.
  • Last character in the PAN is an alphabetic check digit.

You can know your PAN too, if you forget it at any point. You can track PAN application status too, if you have applied for it.