Is it mandatory for NRIs to obtain PAN?

PAN is a unique 10-digit alphanumeric identification number issued by the Income-tax department to the taxpayers.

It is mandatory for every NRI to obtain PAN:

  • if he has taxable income; or
  • if his sales or revenue from business or profession is likely to exceed INR 500,000 in a financial year; or
  • if he is the Managing Director, Director, Partner, Trustee, Author, Founder, Chief Executive Officer, Principal Officer
  • if he is entitled to receive any income which is subject to TDS or TCS in any financial year
  • if he intends to enter the following transactions: 
Nature of TransactionsTransactions Value
Sale or purchase of Motor Vehicle (except two wheeler)
All Transactions
Opening a Bank account and a demat account
All Transactions 
Application for credit or debit card
All Transactions 
Payment to Mutual Funds
Exceeds INR 50,000
Deposits – Banks, Co-operative Banks
Exceeds INR 50,000 (one day)
Terms Deposit – Banks, Post Office, NBFC
Exceeds INR 50,000 (single) or INR 500,000 (in total)
LIC Premium
Exceeds INR 50,000
Sale or Purchase of shares of a Private Limited Company
Exceeds INR 100,000
Sale or Purchase of any immovable Property
Exceeds INR 100,000

There may be certain situations wherein a NRI is unable to quote his PAN in the specified transactions as referred to in above table since he does not have taxable income in India. In such situation, he can make a declaration in Form 60 with particulars of such transaction.

Penalty consequences relating to PAN:

  • INR 10,000 for failure to obtain PAN;
  • INR 10,000 for applying for another PAN when already in possession of a PAN;
  • INR 10,000 for failure to quote PAN.
Disclaimer: The views / the analysis contained therein do not constitute a legal opinion and is not intended to be an advice. Readers of this document are advised to seek their own professional advice before taking any course of action or decision, based on this document.

Stay updated on Tax Information

Ask your question here & we will get back to you soon