PAN OR AADHAR IS REQUIRED TO WITHDRAW RS. 20 LAKH OR MORE AND OPEN A CURRENT ACCOUNT

The Central Board of Indirect Taxes (CBDT) has notified amendments to the Income Tax Rules that make mention of PAN necessary for persons who make large deposits and withdrawals over the cash counter in order to address tax avoidance through the use of cash. Anyone depositing or withdrawing Rs 20 lakh or more from one or more bank accounts in a financial year will be required to quote their Permanent Account Number (PAN) from May 26.When opening a current account, the same rules apply. This guideline applies to accounts that are already associated with a PAN number.The Finance Ministry imposed Tax Deducted at Source (TDS) on cash withdrawals over Rs 20 lakh in the Budget for 2020, and this amendment to the law has been added for specific transactions. The government claims that the move is in line with its strategy of reducing the usage of cash in transactions and promoting digital alternatives. The CBDT has said that under the new rule, an individual’s PAN or Aadhaar number, as well as demographic or biometric information, must be submitted to the Principal Director General of Income-tax (Systems) or Director General of Income-tax (Systems), or a person authorised by the Principal Director General of Income-tax (Systems) with the Board’s approval, for the purposes of authentication.

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