PAN and PRAN Cards: Who Uses Them And How They Differ

PAN (Permanent Account Number) and PRAN (Permanent Retirement Account Number) may appear similar due to their acronyms, but they serve entirely different purposes in the realm of financial transactions. Both are crucial for individuals in various financial contexts, but they are distinct identifiers with unique applications. Here's a breakdown of the key differences between PAN and PRAN:

PAN (Permanent Account Number):

• Issued by the Income Tax Department of India, PAN is a 10-digit alphanumeric identifier.
• PAN is mandatory for all Indian taxpayers, and it plays a pivotal role in managing and recording tax-related transactions and information.
• It is essential for various income tax-related activities, including income tax return filing, refund claims, and filing revised returns.

PAN is used by individuals and business entities for tax payments and various other financial transactions.

It is also recognized as a valid Know Your Customer (KYC) document.

Applications for PAN can be submitted online through the NSDL portal or the e-filing portal.

To apply for PAN, individuals need to provide proof of identity, address, a photograph, and proof of date of birth.

PAN records are maintained by the Income Tax Department.

Holding more than one PAN is not allowed under existing tax laws.

PRAN (Permanent Retirement Account Number):

• PRAN is a distinct 12-digit alphanumeric identifier issued by the National Securities Depository Limited (NSDL).
• It is specifically required for individuals who invest in the National Pension System (NPS) and is mandatory for all NPS subscribers.

PRAN serves as a unique identification number for tracking NPS investments and claiming pension benefits.

Under PRAN, individuals can have two types of NPS accounts: Tier-I and Tier-II.

Applications for PRAN can be submitted through the NSDL portal.

To apply for PRAN, subscribers need to provide a duly filled application form, a photograph, and KYC documents.

PRAN records are maintained by the Central Recordkeeping Agency (CRA).

Each user is allowed to have only one PRAN account.

PAN is primarily used for income tax-related purposes and various financial transactions, while PRAN is specific to individuals participating in the National Pension System, aiding in pension fund management and tracking. Understanding the distinctions between these two unique identifiers is crucial for individuals navigating India's financial landscape.