The Central Board of Direct Taxes (CBDT) has made new rules, called the Income–tax (Fifteenth Amendment) Rules, 2022. The rules were notified on May 10.
Salient features of Income–tax (Fifteenth Amendment) Rules, 2022
- The (CBDT) has expanded the requirement of Permanent Account Number (PAN), the identification number issued by the tax authority, to more transactions as part of efforts at closer monitoring of economic activity.
- Cash deposits or withdrawals exceeding Rs. 20 lakh in one or more bank account or post office in a financial year would need to quote the PAN or Aadhaar number.
- The Rs 20 lakh threshold is for the aggregate of all deposits or aggregate of all withdrawals in a year. This requirement also covers deposits and withdrawals from cooperative banks.
- Opening of a current account or cash credit account by a person with a bank or post office needs to quote PAN.
- The notification also says that any person who intends to make these transactions should apply for a PAN at least seven days before the date on which the transaction is intended to be made.
- Already, there is a requirement for quoting PAN on bank deposits of over Rs 50,000 made in one day and on a host of other transactions like payment of over Rs 50,000 for purchase of mutual funds, debentures, foreign exchange and for settling hotel bills at any one time.
- The annual threshold of Rs 20 lakh deposit or withdrawal suggests that one cannot breach this threshold without quoting PAN by making too many smaller deposits below the daily threshold of Rs. 50,000.
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