You are required to submit PAN card details to your employer and the income tax department has asked employers to deduct TDS at the rate of 20% or even higher.

As per the  Income Tax Act, it is mandatory for all employees to submit their PAN (Permanent Account Number) to their office’s HR or accounts department as the onus is on your office to make TDS (tax deduction at source) if the income is above the taxable limit. While deducting tax at source, it is obligatory for your employer to quote your PAN or Aadhaar number. You can check the status of TDS through the income tax department’s TRACES portal.

Here are the few things to know about PAN card rule :

  1. Those whose income is below the taxable limit is not required for you to submit either PAN or Aadhaar card as no TDS is meant to be deducted by your employer under Section 206AA of the Income Tax Act. For the financial year 2019-20, income up to 2.5 lakh is tax-exempt.
  2. In case if someone fails to provide the PAN card details, your employer will deduct TDS at the rate of 20% or even higher. However, where the income of the employee computed for TDS under Section 192 is below taxable limit, no tax will be deducted.
  3.  Ever since PAN and Aadhaar have been made interchangeable from last year, you can quote the 12-digit identity number given by the UIDAI in lieu of the 10-digit alphanumeric number issued by the income tax department. But before doing that, ensure that the two identity documents are interlinked.
  4.  While quoting your Aadhaar number in lieu of PAN, you must be careful as giving an incorrect number will lead to a fine of 10,000 under Section 272B of the Income Tax Act, 1961.
  5.  In case you failed to provide PAN to your employer who deducted a higher rate of tax from salary, you can always claim a tax refund after the filing of income tax returns (ITR).