No, it’s not mandatory unless you have a source of income in India and you need to have a PAN in order to file the taxes. However, it is good to apply for a PAN regardless you have or haven’t any source of income in India.
Which Pan Card Application for NRI is required?
NRIs have the nationality of another country need to fill up Form 49AA and NRIs who are Indian citizens have to apply for a PAN by filling Form 49A. NRIs can access the UTIITSL and NSDL websites for accessing, filling and submitting pan card applications for NRI. Once the application form is submitted, an acknowledgment copy with a 15 digit number is generated. That copy along with necessary documents needs to be submitted to the specific address.
Documents Required for NRI to Apply PAN Card NSDL
NRI applicants are required to submit the following documents when applying for a PAN card:
- 2 recent passport-sized photographs. That should be pasted in the space provided in the acknowledgment form.
- Copy of passport as proof of identity.
- Overseas address proof (any one of the following)
- Copy of Passport, Copy of bank account statement in country of residence OR Copy of NRE bank account statement showing at least two transactions in six months and duly attested.
Fees
If the communication address is within India, NRI needs to pay Rs 107. If the communication or delivery address in outside India, the fees will be Rs 989 (includes application fees and dispatch charges). While opting online application method you can pay the application fees via debit/credit card or through Net banking. On the other side, you can submit the demand draft favoring UTIITSL/NSDL along with application form and documents.
Process for NRIs to Apply for a PAN Card
PAN application process is quite simple consisting very easy steps and instructions to follow. What steps one needs to follow are clipped here:
1. An NRI applicant can log on to the official website of TIN-NSDL or UTIITSL to start the application process.
2. An NRI citizen should use Form 49A. The application form contains all the necessary information.
3. Make sure you should submit the form along with the fees and necessary documents such as photographs, proof of address, ID proof and proof of age. There are some variations in fees which we have already described in the Fees Section.
4. An acknowledgment number will be generated post payment. This number can be employed to track the status of a particular application.
Points to Note
In case if NRIs don’t have any Indian address, they can a foreign address as residential or office address.
There are only a few countries in which PAN card dispatch facility outside India is available. Make sure you have confirmed the list before applying for pan card.
Importance of PAN for NRIs
A PAN card is mandatory for NRIs in various scenarios, including:
– Investing in India: Whether purchasing property, investing in mutual funds, or trading in the stock market, a PAN is required.
– Opening Bank Accounts: While basic NRI accounts like NRE or NRO accounts may not always require a PAN, it becomes necessary for high-value transactions or tax-related purposes.
– Filing Tax Returns: If an NRI earns taxable income in India (such as rent, capital gains, or interest), a PAN is mandatory for filing returns.
– Property Transactions: Buying or selling immovable property in India exceeding a specified value requires PAN submission.
Eligibility for PAN Card Application
NRIs, including Indian citizens and foreign citizens of Indian origin, are eligible to apply for a PAN card. The process is similar to that for resident Indians, but certain additional documents may be required to establish identity and address.
How to Apply for a PAN Card as an NRI?
NRIs can apply for a PAN card either online or through authorized agents. The steps include:
1. Online Application: – Visit the NSDL or UTIITSL portal. – Fill Form 49A (for Indian citizens) or Form 49AA (for foreign citizens). – Upload scanned copies of documents. – Pay the applicable fee online.
2. Offline Application: – Submit physical copies of the form and documents to an authorized PAN center or Indian embassy/consulate abroad.
Once processed, the PAN card is dispatched to the overseas address provided.
Common Challenges Faced by NRIs
1. Address Proof Issues: NRIs often struggle with providing valid Indian address proofs. Using an overseas address is permissible but may delay processing.
2. Name Mismatches: Discrepancies between passport names and other documents can cause rejections.
3. Delays in Processing: International shipping and verification can prolong the issuance time.
Surrendering PAN Card After Relocation
If an NRI acquires foreign citizenship, surrendering the Indian passport is mandatory, but the PAN card need not be surrendered. However, updating the status with the Income Tax Department is advisable to avoid discrepancies.
Conclusion
For NRIs, a PAN card is indispensable for managing financial and tax obligations in India. Understanding the application process, documentation, and tax implications ensures smooth compliance with Indian regulations. Proper planning and timely application can help NRIs avoid legal and financial hassles while maintaining ties with their home country. The PAN card remains a vital link for NRIs engaging in economic activities in India.
