We all are familiar with a Permanent Account Number (PAN) card. If you are an Indian or an NRI, you need a PAN card. Whether you are working or not, you can apply for a PAN card; there is no restriction on age, region or nationality. A PAN is a ten-digit alphanumeric number, issued in the form of a laminated card by the Income Tax Department of India. It is not only used for tax payments but also for all kinds of financial transactions you make.
But have you ever wondered what does that 10 digit alphanumeric sequence mean?
1. The first three letters of the core field are an alphabetical series running from AAA to ZZZ.
2. The fourth character of the PAN must be one of the following, depending on the type of assess:
- 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 (Example – Company = AAACA; Artificial Juridical Person = AAAJA; HUF = AAAHA; etc.)
3. The fifth character of the PAN is the first character of the following:
- Your surname in the case of “Person” or;
- For all others you would use the first letter of the name of the Entity, Trust, Society, Organization, HUF, etc.
4. The next four numbers are sequential numbers running from 0001 to 9999.
5. The last digit is an alphabetic check digit.
So now, you know what your PAN means!