PAN Card Surrender

A PAN (Permanent Account Number) card is a 10-digit alphanumeric number issued to taxpayers in India. This unique number is crucial for tax purposes when identifying individuals and entities. However, an individual is permitted to hold only one PAN card throughout their lifetime. If a person holds multiple PAN cards or in the event of certain changes such as death, relocation, or business dissolution, they must follow a procedure to surrender the extra or unnecessary PAN card. If you are wondering "How to surrender PAN card?" this guide will walk you through the reasons for PAN card surrender, the steps involved, and the consequences of not doing so. Need a PAN Card? Apply now with IndiaFilings for a quick, hassle-free PAN card application process. Get expert assistance every step of the way!

Introducing PAN 2.0

The Indian government has launched PAN 2.0, a revolutionary upgrade to the existing PAN (Permanent Account Number) system, designed to modernise and digitise the management of PAN and TAN. With enhanced security features and AI-powered technology, PAN 2.0 makes tax compliance smoother and more efficient. Want to Know More About PAN 2.0? Click here to learn all about its features and benefits!

Reasons for PAN Card Surrender

There are several reasons why an individual or entity may need to surrender their PAN card. These include:

Holding Multiple PAN Cards: It is illegal to hold more than one PAN card in India. If you have applied for a PAN card multiple times, whether due to a mistake or administrative error, you may end up with duplicates. In such cases, the duplicate PAN cards must be surrendered to avoid legal consequences and penalties.
Death of the PAN Cardholder: If the PAN cardholder passes away, the PAN card needs to be surrendered. This process can be done by family members or legal heirs, and it ensures that the PA number is cancelled to prevent misuse.
Closure of Firm, Partnership, or Company: If a business entity such as a firm, partnership, or company is dissolved or closed, its PAN card must be surrendered to the Income Tax Department. This ensures that the tax records are properly updated and that no further tax obligations arise for the dissolved entity.
Cancellation or Invalidity: Sometimes, a PAN card may be issued in error, such as for a person who is not eligible or a company that no longer exists. In such cases, the PAN card must be cancelled and surrendered.
Relocation Outside India: If an individual is permanently relocating outside India and will no longer be liable for Indian taxes, their PAN card can be surrendered.
PAN Card Errors: If there are errors in the details of the PAN card, such as incorrect name, date of birth, or other personal information, the individual may need to cancel or surrender the card and apply for a correction.

Consequences of Holding Multiple PAN Cards

As per Section 139A of the Income Tax Act, 1961, holding more than one PAN card is prohibited and can lead to penalties. Here’s a breakdown of the consequences:

Penalty for Multiple PAN Cards

As per Section 272B of the Income Tax Act, holding more than one PAN card can lead to significant penalties. The Income Tax Department can impose a fine of up to ₹10,000 on an individual who holds more than one PAN card.

Ineligibility for Linking PAN with Aadhaar

The Aadhaar-PAN linkage is a critical step for tax compliance and financial transactions in India. However, an individual can only link one PAN card with their Aadhaar card. If multiple PAN cards are in use, only one can be linked, while the rest need to be surrendered or cancelled.

Issues in Financial Transactions

A PAN card is essential for conducting various financial transactions, such as:

Opening bank accounts
Filing income tax returns
Making investments
Receiving or making payments exceeding ₹50,000

Multiple PAN cards can lead to confusion in the system and affect financial activities. Incorrect Taxation and Financial Record-Keeping Having more than one PAN card can lead to errors in the individual's financial and tax records. Multiple PAN numbers could cause discrepancies in tax filings, and the government might mistakenly believe that the taxpayer is evading taxes.

How to Surrender PAN Card for Individuals

Individuals can surrender their PAN card in two ways: online and offline. The process is simple if you follow the required steps carefully.

How to surrender PAN card online

If you have a duplicate PAN card, you can surrender it online through the Income Tax Department website.

Visit the Income Tax Department Website: Go to the official website and select the "Surrender Duplicate PAN" option.
Fill in the Details: Enter the PAN details you want to retain, along with your personal details (name, date of birth, contact details).
Submit the Form: Follow the instructions provided on the website to complete the process.

PAN Surrender Form

Download the attached PAN card surrender form PDF for your reference and follow the steps to complete the process seamlessly.

NSDL PAN surrender Online Process

The process for NSDL PAN card surrender is explained.

Visit the NSDL Website: Go to the official NSDL website and navigate to the ‘PAN Change Request Online Form’ page.
Select Application Type: Choose “Changes or Correction in Existing PAN Data/Reprint of PAN Card” from the options available.
Fill Out the Form: Complete the form with necessary details, including citizenship, category, title, and other required information. Once done, click ‘Submit.’
Note the Token Number: After submission, a token number will be sent to your email. Keep this for future reference. Then click “Continue with PAN Application Form.”
Choose Submission Method: Select your preferred method of submission: Aadhaar-based e-KYC/e-Sign, Digital Signature Certificate, or physical submission.
Complete the Fields: Fill out all fields, indicate the PANs you wish to surrender, and select the appropriate checkboxes. Then click ‘Next.’
Upload Documents: Choose proof of identity, residence, and date of birth, and upload these along with your photo, signature, and other required documents. Ensure all signatures are authorised.
Review and Payment: Review your PAN surrender application for accuracy, make necessary edits, and proceed to payment. Payments can be made via demand draft, credit/debit card, or internet banking.
Acknowledgement: Once payment is successful, download the acknowledgement.
For Physical Submission: If you opted for physical submission, print and sign the acknowledgement, attach photographs, label the envelope, and send it to NSDL e-Gov.

Mailing Address: NSDL e-Gov, Income Tax PAN Services Unit, 5th Floor, Mantri Sterling, Plot No. 341, Survey No. 997/8, Model Colony, Near Deep Bungalow Chowk, Pune – 411 016. Note: Ensure all documents, including signed acknowledgement and demand draft (if applicable), are submitted within 15 days.

How to surrender PAN card - Offline Process

You can also surrender your PAN card offline by submitting a form and writing a PAN card surrender letter to your Assessing Officer.

Fill Out the Form: Complete the “Request For New PAN Card Or/And Changes Or Correction in PAN Data” form.
Visit NSDL Collection Centre: Take the filled-out form along with the necessary documents to your nearest NSDL collection centre.
Obtain Acknowledgment: After submitting the form and documents, you will receive an acknowledgement slip.
Submit Acknowledgment to NSDL: Send the acknowledgement slip to NSDL within 15 days.
Write to the Assessing Officer: Prepare a letter explaining the duplicate PAN issue and request its cancellation. You may also consider providing an affidavit confirming you hold only one PAN.
Submit the Letter: Visit your local Income Tax Assessing Officer and submit the letter requesting cancellation of the duplicate PAN.
Keep Acknowledgment: Retain the acknowledgement number for reference.

PAN card surrender process for Deceased Person

When the PAN cardholder passes away, the family members or relatives can request the surrender or cancellation of the deceased’s PAN card. The following steps should be followed:

Write a Letter: A letter should be addressed to the Income Tax Officer of the jurisdiction where the deceased's PAN card was registered, explaining the reason for surrender (i.e., death of the cardholder).
Include Required Details: The letter should include the name, PAN number, date of birth, and other personal details of the deceased PAN cardholder.
Attach Death Certificate: The death certificate of the deceased person must be attached to the letter.
Follow the Same Process for Indian Residents, NRIs, or Foreign Nationals: The process for surrendering the PAN card is the same, regardless of whether the deceased is an Indian resident, NRI, or foreign national.

How to surrender PAN card of a Firm, Partnership Firm, or Company

When a firm, partnership firm, or company is dissolved or closed, the PAN card registered under its name must be surrendered.

PAN card Surrender Online Procedure for Firm or Company

Visit the NSDL Website: Go to the official NSDL website.
Choose the Correct Application: Select "Changes or Correction in existing PAN data/Reprint of PAN card" from the available options and complete the form with the required details.
Enter PAN Details: In the section labelled “Mention other Permanent Account Numbers (PANs), if any, inadvertently allotted to you,” enter the PAN number to be cancelled.
Review and Payment: Double-check the form, and then proceed to make the required payment using a credit/debit card or net banking.
Acknowledgement Receipt: After submission, print the acknowledgement receipt.
Prepare Documents: Along with the acknowledgement receipt, include a copy of the PAN card to be surrendered, the dissolution deed (if applicable), and a covering letter expressing the intention to surrender the PAN card.
Mail the Documents: Send the documents to the NSDL e-Gov Income Tax PAN Services Unit at the specified address.
Confirmation: Await a notification confirming the processing of your request.

PAN card Surrender Online Procedure for Firm or Company

Compose a Letter: Write a letter to the Income Tax Officer in charge of the jurisdiction where the firm or company filed taxes. The letter should explain that the firm or company is being dissolved and, therefore, the PAN card needs to be surrendered.
Attach Necessary Documents: Include a copy of the dissolution deed, the PAN card to be surrendered, and the acknowledgement of the last filed return showing the discontinuation of the firm/company.
Submit Documents: Submit the letter and documents to the relevant Income Tax Officer.
Obtain Acknowledgment: Keep the acknowledgement receipt provided by the officer as proof of submission.

Procedure to Surrender the PAN Card in Use

It is generally advised not to surrender a PAN card, as it serves as valid identity proof and is required for tax filing and various financial transactions. However, in cases where a foreign national leaves India and will no longer be paying taxes in India, the PAN card can be surrendered. The process involves:

Write a Letter to the Income Tax Officer: The individual should submit a PAN surrender letter to the Income Tax Officer in their jurisdiction, stating the reason for surrendering the PAN card (leaving India and no longer liable for tax).
Provide Personal Details: The letter should include the individual’s name, nationality, PAN number, and permanent address.
Submit the PAN Card: After the PAN card is cancelled, the physical copy can be surrendered to the tax office.

PAN card Surrender Status Check

After submitting your PAN card surrender form, you can check the PAN surrender status of your application by following these steps:

Visit the Income Tax E-Filing Website: Go to the official e-filing website.
Select ‘Verify PAN Status’: Under the ‘Quick Links’ section, click ‘Verify PAN Status.’
Enter Required Information: Enter your PAN number, name, date of birth, and mobile number. Then, click on ‘Continue.’
Enter OTP: You will receive an OTP on your mobile number. Enter the OTP and click ‘Validate.’
View the Status: The status of your PAN card surrender request will be displayed on the screen.

Things to Remember Before Surrendering Your PAN Card

Reason for Surrender: Be clear about why you're surrendering the PAN card (e.g., multiple cards, death of cardholder, or business dissolution).
Required Documents: Ensure that you have all the necessary documents, such as the PAN card to be surrendered, proof of identity, date of birth, and other supporting documents.
Online or Offline: Decide whether you want to process the surrender online or offline, depending on convenience.
Acknowledge Receipt: Always get an acknowledgement receipt, especially when submitting offline.
Notify Relevant Entities: After surrendering the PAN card, inform banks and other financial institutions about the cancellation.

Consequences of Not Surrendering a PAN Card

Penalties: As mentioned earlier, holding more than one PAN card can lead to a penalty of ₹10,000 under Section 272B of the Income Tax Act.
Tax Confusion: The presence of multiple PAN cards can confuse the tax authorities and lead to discrepancies in your tax filings.
Risk of Fraud: An unreturned PAN card can be misused for fraudulent activities, such as opening bank accounts or applying for loans in someone else’s name.

Conclusion

Surrendering your PAN card is an essential process that ensures your tax records are updated, your identity is protected, and you avoid any legal penalties. Whether you have multiple PAN cards, a deceased family member, or a business that has been dissolved, following the correct procedure for surrender is crucial. Always ensure that you have the correct documents and follow the steps for either online or offline submission. If you are uncertain or need help, talk to IndiaFilings advisors.