Introduction

A Permanent Account Number (PAN) card is a critical document for financial transactions in India. However, there are situations when an individual or entity might need to cancel or surrender PAN card. Whether due to duplication, non-usage, or legal requirements, surrendering a PAN card has become streamlined with online options.

This blog aims to guide you through the step-by-step process to surrender PAN card online, ensuring a hassle-free experience.

What is PAN Card Cancellation or Surrender?

A Permanent Account Number (PAN) card is an essential financial document used for tax purposes in India. However, there are instances when an individual or organization may need to cancel or surrender their PAN card. The PAN is a vital identifier the Income Tax Department issued to individuals, businesses, and other entities in India for tax purposes.

This process ensures that you comply with legal requirements and avoid penalties for holding an unnecessary or duplicate PAN card. To surrender pan card, a formal procedure is required that helps you deactivate a PAN card.

Why Would You Need to Cancel or Surrender PAN Card?

Understanding the eligibility criteria for PAN card cancellation or surrender is crucial to ensure that you comply with the Income Tax Act and avoid any legal or financial consequences.

Not everyone may qualify to cancel or surrender their PAN card, and the eligibility often depends on the circumstances surrounding the cardholder’s situation.

1. Duplicate PAN Card Holders

If an individual or entity has been issued multiple PAN cards under the same name or business, they can cancel the duplicate PAN cards. This could happen due to clerical errors or intentional duplicate applications.

Holding more than one PAN card is illegal and subject to penalties under Section 272B of the Income Tax Act.

2. PAN Cardholder’s Death

In the unfortunate event of a PAN cardholder’s death, their family members or legal representatives should surrender the PAN card to ensure that it is not used for any future tax filings or financial transactions.

The PAN cardholder’s legal heirs or authorized individuals can initiate the surrender process by submitting relevant documents, such as the death certificate, to the Income Tax Department.

3. Closure of a Business or Professional Activity:

The associated PAN card can be surrendered if a business or professional activity has been shut down or ceased to exist.

Business owners, sole proprietors, and freelancers should initiate the cancellation process once their operations are officially closed to avoid ongoing tax liabilities and legal obligations. In this case, the cancellation or surrender ensures no further use of the PAN card.

4. Change in Name or Business Structure

If there is a change in the name of the PAN cardholder (due to marriage or other reasons), or a change in business structure (for example, from a sole proprietorship to a limited company), the existing PAN card may no longer be valid. In such cases, the individual or business can surrender the existing PAN card and apply for a new one.

5. Mistakes in PAN Card Information

If the PAN cardholder discovers errors or discrepancies in the details of their PAN card, such as the wrong spelling of the name, incorrect date of birth, or other mistakes, they can surrender the current PAN card.

The eligibility for cancellation is based on the need to correct the information on the PAN card. Instead of correcting, the individual can surrender the incorrect PAN card and apply for a fresh one with accurate details.

Documents Required to Surrender PAN Card

The documents required depend on the reason for surrender or cancellation.

Here are the requirements :

1. Application Form for PAN Card Surrender (Form 49A/49AA)

The first and most important document is the application form that needs to be submitted for PAN card cancellation or surrender. You can use the following forms depending on your situation.

Here are the necessary forms:

Form 49A: For Indian citizens or entities seeking to cancel their PAN card. Used by Indian citizens, Hindu Undivided Families (HUFs), and Indian entities to cancel or surrender their PAN cards.
Form 49AA: For foreign citizens or entities requesting PAN card cancellation. Designed for foreign citizens, companies, or entities with financial interests in India who wish to cancel their PAN.

2. Proof of Identity (POI)

Proof of Identity (POI) is a mandatory document required to cancel or surrender PAN card. It establishes the applicant’s identity and ensures the process is secure and reliable. The POI must be valid, up-to-date, and aligned with the name provided in the PAN card cancellation application.

The following are some commonly accepted POI documents:

Aadhaar Card: Universally accepted across India as proof of identity. It must be linked to the PAN for seamless processing.
Passport: Valid for Indian and foreign citizens. Includes the applicant’s name, date of birth, and photograph.
Voter ID Card: Serves as a valid ID for Indian citizens. Includes a photograph and personal details that match PAN records.
Driving License: Accepted if issued by a recognized Regional Transport Office (RTO). Includes a photograph and signature.
Ration Card with Photograph: This card is helpful for individuals from rural areas or those without other government IDs. Must include the applicant’s photograph.

3. Proof of Address (POA)

Proof of Address (POA) is another critical document required to cancel or surrender a PAN card. It verifies the applicant’s residential or business address and ensures that the PAN card is correctly registered with accurate details.

The following documents are generally accepted as valid proof of address:

Aadhaar Card
Widely used for both identity and address verification in India. It contains the individual’s photograph, name, and complete residential address.
Passport
Provides the applicant’s full residential address along with other personal details. Valid for both Indian citizens and foreign nationals.
Voter ID Card
Also known as an Election ID card is an accepted proof of address and includes the applicant’s residential address and personal details.
Utility Bills (Electricity, Water, Gas, etc.)
It must contain the applicant’s name, address, and the service provider’s details.
Bank Statement or Bank Passbook
Bank statements from a recognized financial institution containing the applicant’s address. Must be recent (within the last 3 months) and include the applicant’s name and address.

4. PAN Card to be Surrendered

To cancel or surrender PAN card, you must submit the original PAN card for which you request the cancellation. You must surrender all duplicate PAN cards and retain only the original ones for multiple PAN cards.

5. Self-Attested Copy of Documents

Self-attestation means that you sign on each document to declare its authenticity. These copies should be clear and readable to avoid delays in the process.

6. Death Certificate (In Case of Death of the PAN Cardholder)

If the PAN cardholder has passed away, the legal heir or representative must submit a death certificate issued by a competent authority. This document should be an official or notarized copy that the Income Tax Department can verify.

Step-by-Step Process to Surrender PAN Card Online

Canceling or surrendering a PAN card online has been made easy through the online portal provided by the Income Tax Department of India. Whether you have multiple PAN cards, need to correct an error, or are simply closing down your business, it’s important to follow the correct process for PAN card surrender.

This step-by-step guide will walk you through the entire process, from initiating the request to tracking its status.

Step 1: Visit the Official Income Tax Department Portal

To cancel or surrender your PAN card, visit the official Income Tax Department website. You will find detailed information regarding PAN card services.

Open the website on your browser(www.incometax.gov.in)
Look for the “Services” section and click on it.
Under the “PAN” section, you will find an option for “Apply for PAN” or “Change/Update PAN”.
Select the option for “Surrender PAN”.

Alternatively, to surrender the PAN card, you can visit the NSDL (National Securities Depository Limited) or UTIITSL (UTI Infrastructure Technology and Services Limited) websites.

Step 2: Select the Correct Form

Once you are on the appropriate page, the next step is to select the correct form for surrendering your PAN card. The first and most important document is the application form that needs to be submitted for PAN card cancellation or surrender.

You can use the following forms depending on your situation.

Form 49A: For Indian citizens or entities seeking to cancel their PAN card. Used by Indian citizens, Hindu Undivided Families (HUFs), and Indian entities to cancel or surrender their PAN cards.
Form 49AA: For foreign citizens or entities requesting PAN card cancellation. Designed for foreign citizens, companies, or entities with financial interests in India who wish to cancel their PAN.

Step 3: Fill in the PAN Cancellation Form

You will now be directed to a page where you need to fill in the required details. The form must be completed precisely, as errors or omissions could lead to delays or rejections in the cancellation process.

Here are some key fields you will need to complete:

Personal Information: Your name, address, date of birth, and contact details.
PAN Information: Enter the PAN number you wish to cancel or surrender.
Reason for Surrender: Select the reason for surrendering your PAN card (e.g., duplicate PAN card, PAN card no longer required, etc.).

Step 4: Upload Supporting Documents

Once the PAN Cancellation Form is filled out, the supporting documents will be uploaded next. These documents are vital as they verify your identity and support the PAN card cancellation request letter.

The required documents generally include:

Proof of Identity (POI): A government-issued identity proof such as an Aadhar card, passport, or voter ID.
Proof of Address (POA): A document confirming your address, such as a utility bill or bank statement.
Cancelled Cheque or Bank Statement: Some requests may require this to confirm your bank details, exceptionally if you’re requesting a refund or seeking to change the linked bank account.

Step 5: Pay the Required Fee (If Applicable)

In most cases, there is no fee to surrender PAN card. However, if you are making any corrections to your PAN or updating your information, there may be a nominal fee for processing. The fee can typically be paid through credit or debit card and net banking ..

Step 6: Submit the Application

After you have filled in all the necessary details, uploaded the required documents, and made any necessary payments, it is time to apply.

Review all the information you have entered.
Double-check the documents you have uploaded.
Click on the “Submit” button to send your application for PAN card surrender.

Step 7: Acknowledgment and Reference Number

Once your PAN card surrender request has been successfully submitted, the system will generate an Acknowledgment Receipt. This receipt will include a reference number. Keep a copy of this receipt to track your application’s status and future reference.

Step 8: Track the Status of Your PAN Surrender Request

After submitting your application, you can track the status of your request using the acknowledgment number:

Return to the PAN services section on the Income Tax or portal to fill NSDL PAN surrender form
Click on “Track PAN Request Status.”
Enter your reference number and the date of birth or PAN details.
Click “Submit” to view the status of your cancellation request.

Step 9: Confirmation of Cancellation

Once the PAN card surrender request has been processed, the Income Tax Department will send you a confirmation via email or SMS regarding the cancellation or surrender of your PAN card.

If your request is accepted, the PAN will be officially canceled, and you cannot use the card for any further transactions. Any duplicate or invalid PAN cards should be destroyed after confirmation.

Step 10: Notify Financial Institutions (Optional)

After confirming the cancellation, notify your banks, financial institutions, and other authorities where the surrendered PAN card was linked. This ensures that the canceled PAN is not used for any monetary transactions.

How to Track the Status of PAN Card Cancellation

Tracking the status of your PAN card cancellation request is a crucial step to ensure that the process is completed successfully. Once you have submitted your application for the surrender or cancellation of your PAN card, you should check whether your request has been processed or if any further actions are needed.

Here is the step-by-step process:

Step 1: Visit the Official PAN Portal

To track the status of your PAN card cancellation, you need to visit the official website of the Income Tax Department or the service providers such as NSDL (National Securities Depository Limited) or UTIITSL (UTI Infrastructure Technology and Services Limited).

Step 2: Select the “Track PAN Status” Option

Once you’re on the portal, locate the PAN-related services section. After filling out the cancellation form, the next step is to track the status of your PAN cancellation request. Most official PAN-related services, including cancellation, allow you to monitor the progress of your application online.

On the Income Tax Department website, look for the “Track PAN Request Status” option under the “Services” or “PAN” section.
On the NSDL portal, navigate to “Track PAN/TAN Status”.
On the UTIITSL website, choose “Track PAN Application Status”.

Step 3: Enter the Required Details

To complete the PAN cancellation process, providing accurate and necessary details in the form is essential. Entering the correct information ensures that your PAN card cancellation request is processed smoothly and without any delays.

To track the status of your PAN cancellation request, you will be asked to provide the following details:

Acknowledgment Number: This is the reference number you received when you successfully submitted your PAN card cancellation application.
Date of Birth: Enter your date of birth or the relevant details as requested.

Step 4: Submit the Information

After entering the acknowledgment number and your date of birth, click on the Submit button. The system will process your request and display the current status of your PAN card cancellation request.

Step 5: Check the Status

Once the information is submitted, the system will update you on your PAN card cancellation status.

Possible status messages include:

“PAN Surrendered Successfully” means your PAN card cancellation request has been processed and accepted.
“Pending”: If the status shows pending, your application is still under review, and further action may be needed.
“Rejected”: If the status is rejected, the portal will provide a reason for rejection, such as invalid information or missing documentation. In this case, you may need to reapply or correct any discrepancies.

Step 6: Print or Save the Status

After submitting the PAN cancellation form and completing all required steps, tracking the status of your PAN card cancellation request is essential. You will receive a status update once the Income Tax Department completes the cancellation process.

Common Mistakes to Avoid

Cancelling or surrendering a PAN card may seem straightforward, but it’s easy to make mistakes that can delay the cancellation or even lead to the rejection of your request. To avoid unnecessary complications, it’s essential to be aware of the common errors people make during the PAN card cancellation process.

1. Submitting Incorrect Details

One of the most common mistakes is providing incorrect personal details when filling out the application form. This can include your name, date of birth, or PAN number errors. Any mismatch between the details in your application and the official records could result in the rejection of your cancellation request.

2. Failing to Submit Required Documents

To process your PAN card cancellation, you need to submit certain documents. Some standard documents include :

Proof of identity: For example, your Aadhaar card, passport, or voter ID.
Proof of address: Documents such as utility bills, bank statements, or passports showing your current address.
The PAN card itself: If you surrender it, this is a mandatory submission.

3. Not Tracking the Application Status

After submitting your cancellation request, many individuals forget to track the status of their application. Not monitoring your application’s progress can lead to delays or missed deadlines for rectifying issues.

4. Applying for Cancellation of a Valid PAN

Another mistake is applying for cancellation of a PAN card that is still valid and necessary. Some individuals may mistakenly cancel their PANs without realizing they still require it for financial or tax-related purposes.

5. Not Providing the Correct Reason for Surrender

When surrendering a PAN card, you need to mention the reason for doing so. Failing to provide an apparent and correct reason may lead to confusion or delays in processing the cancellation request.

6. Ignoring the Impact on Other Registrations

Canceling a PAN card could have implications for other financial or business registrations, such as GST registration or company filings. If you have linked the PAN card to any of these registrations, canceling it may disrupt the associated processes.

Consequences of Not Cancelling Duplicate or Unused PAN Cards

Many individuals may find themselves possessing more than one PAN card due to an error during the application process or because they no longer need a particular card. However, neglecting to cancel or surrender duplicate or unused PAN cards can lead to serious consequences, both legally and financially.

Here are some of the consequences :

1. Legal Consequences

The Income Tax Department takes PAN card regulations seriously, and failing to cancel duplicate or unused cards can lead to legal complications.

Penalty for Possessing Multiple PAN Cards: As per Section 272B of the Income Tax Act, individuals who possess more than one PAN card are liable to pay a penalty. The penalty for possessing multiple PAN cards can be as high as ₹10,000.
Violation of Tax Laws: Holding multiple PAN cards can be considered a deliberate attempt to evade taxes or misrepresent financial details. This could attract scrutiny from the Income Tax Department and lead to legal investigations.

2. Risk of Tax Evasion and False Financial Reporting

Having multiple PAN cards can confuse tax filing, leading to incorrect tax returns and possible tax evasion.

Incorrect Tax Filing: Using more than one PAN card could lead to errors in reporting your income and deductions, resulting in inaccurate tax returns. This may lead to penalties or reassessments by the Income Tax Department.
Increased Risk of Tax Evasion Charges: Multiple PAN cards can make it difficult to consolidate your financial data correctly, which may inadvertently result in tax evasion or underreporting of income, leading to severe consequences.

3. Difficulty in Credit and Loan Applications

A PAN card is a crucial identity and financial document used for various financial transactions, including applying for loans, credit cards, or government schemes. Multiple PAN cards linked to your financial identity can create complications and delays when applying for credit or loans.

Delayed Loan Approvals: Financial institutions may reject or delay loan applications due to discrepancies in your PAN records.
Impact on Credit Score: Multiple PAN cards can cause confusion in the credit bureau’s records, leading to inaccuracies in your credit history and negatively impacting your credit score.

4. Inaccurate Filing of GST Returns

For business owners, using a duplicate or unused PAN card can cause complications in GST filings. The PAN card serves as a primary identifier for GST registration, and discrepancies related to PAN can disrupt the filing process.

Rejection of GST Filings: If GST filings are associated with a duplicate or incorrect PAN card, they may be rejected, leading to delays and penalties.
Issues with Input Tax Credit (ITC): Incorrect PAN details could affect your ability to claim input tax credit, which may lead to a higher tax liability.
duplicate PAN cards linked to your GST registration to avoid discrepancies.

Also Read: An Overview of GST Registration

5. Difficulty in E-filing Tax Returns

The presence of multiple PAN cards linked to your name can create confusion when e-filing your income tax returns. The system may flag discrepancies, leading to rejected returns or unnecessary follow-ups with the Income Tax Department.

Rejection of Income Tax Returns: Multiple PAN cards can cause mismatches in the e-filing system, leading to rejected returns and delays in processing refunds.
Prolonged Refund Processing: If the Income Tax Department finds discrepancies in the PAN details, it may delay or even withhold refunds until the matter is resolved.

6. Inability to Update Personal Records

Your PAN card is a key reference for various personal records, such as opening a bank account, applying for a passport, or registering for government services. Duplicate or unused PAN cards can lead to issues when attempting to update these records.

Issues in Bank Account Linking: Banks may refuse to link your PAN card to your account if there are discrepancies between multiple PAN cards.
Delays in Government Service Registrations: Multiple PAN cards can delay or prevent government schemes or benefits registrations.

Conclusion

Properly managing your PAN card is vital to financial compliance in India. PAN card surrender online is now streamlined, ensuring that individuals and businesses can efficiently cancel unused or duplicate PAN cards. Taking the time to complete this process helps avoid legal issues and contributes to better financial organization.

Simplify your financial journey today. For additional assistance, consult a tax expert or visit the Income Tax e-filing portal now! Contact RegisterKaro for more information.

Frequently Asked Questions (FAQs)

1. Can I surrender my PAN card offline?

Yes, visit a PAN service center with the required documents.

2. What happens if I do not surrender my duplicate PAN?

You may face a penalty of ₹10,000 under Section 272B of the Income Tax Act.

3. Can I cancel my PAN card and apply for a new one?

If you need corrections, apply for a PAN correction instead of cancellation.

4. Do I need to surrender my PAN if I move to another state?

No, PAN is a national identity and remains valid across India.

Nikita P

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