Step-by-Step Guide to Cancellation of PAN Card Online & Offline

Overview : A PAN Card is an essential document primarily used for financial and taxation purposes. Similar to obtaining a PAN Card, cancellation of a PAN card is also important in certain conditions, especially if there is more than one PAN card. A heavy penalty may be levied on individuals or even businesses having more than one PAN Card; it may attract fines or sometimes may lead to serious actions like getting jailed. Numerous factors must be taken into consideration before and while cancelling a PAN Card. Learn the step-by-step process to cancel your PAN Card hassle-free with other essentials.

Want to cancel your PAN card? Understanding the reasons and some other key aspects related to PAN cancellation is crucial. This detailed guide on the 'PAN Card Cancellation' explains the full process of PAN card cancellation online or offline; for reasons like multiple PANs and incorrect information/data.

Quick Facts

• You can only have one PAN card, and having multiple can lead to legal and financial consequences, including fines and imprisonment. Don’t cancel an existing PAN card unless absolutely necessary as it’s a vital identification for financial activities.
• PAN card cancellation can be done online through the NSDL website or offline by submitting a letter to the local tax office with required documents in both cases.
• Keep track of the status of PAN card cancellation request online and maintain records of communication with tax authorities to stay compliant and avoid complications.

What is PAN Card Cancellation/Surrender?

In India, as per law, you can only have one PAN card at a time. It is mentioned in Section 139A of the Income Tax Act, which says that you must have one unique identifier for all financial transactions and tax-related activities. Having multiple PAN cards can lead to penalties and fines under the Income Tax Act.

The need to cancel additional PAN Cards arises due to the Aadhaar-PAN linking feature, which has become mandatory in the Indian taxation system. For foreign nationals who no longer require it, undergoing the process of PAN card surrender is important. Whether you need to cancel a PAN card due to errors, loss, or multiple PAN cards, the process can be done online or offline. Following the correct procedure is necessary to avoid any errors or rejection of your application.

Reasons for PAN Card Cancellation

There are many reasons why an individual/business, or other entity may need to cancel a PAN card. Cancellation of PAN Card is also a form of compliance obligations that must be met to avoid penalties. Some of the key reasons behind the cancellation of a PAN Card are as follows;

• Errors in the initial application process
• Multiple PAN Cards
• Loss or theft of PAN card
• Changes in Personal details that require a new card
• Foreign nationals leaving India who will not be paying taxes here anymore, have to surrender their PAN card to the Income Tax Assessing Officer. The process of PAN card surrender involves submitting an application with valid reasons for cancellation along with required documents; either online or offline.

Understanding the legal requirements and consequences of non-compliance will help you to comply with the law and avoid unnecessary complications in your financial dealings. So, initiate your PAN Card cancellation application right away if you have any of the aforementioned reasons.

Consequences of Not Cancelling Additional PAN Cards

Holding multiple PAN cards is a serious offense under Indian tax laws. Failure to cancel additional PAN cards can lead to significant legal and financial repercussions, including stringent penalties such as fines and potential imprisonment imposed by the Income Tax Department.

The penalty for holding multiple PAN cards can be as high as INR 10,000 under Section 272B of the Income Tax Act, imposed to ensure compliance and prevent tax evasion or fraud. Understanding the gravity of holding multiple PAN cards and taking immediate action to cancel any duplicate pan cards helps avoid penalties and ensures your financial transactions are streamlined and legally compliant.

How to Cancel a PAN Card Online?

Due to the digital evolution, cancelling PAN Card is not simple, and easy. You can now cancel your PAN Card online by following the steps involved and fulfilling the document requirements. The process to cancel a PAN Card online is explained below in a step-by-step manner;

Step 1: Visit the official NSDL website

Go to the official NSDL Website using your browser.

Step 2: Select PAN Application Type & Applicant Category

Now, you need to select the 'Changes or Correction in existing PAN data/Reprint of PAN Card' in the PAN Application Type box and also select the Category, whether Individual/Association of Persons/Body of Individuals/Company/Trust/Limited Liability Partnership, or so on from the given options.

Step 3: Fill Necessary Details & Submit

Fill up the necessary details as required and submit.

Step 4: Token Number is Generated

Upon successful form submission, a change request has been registered. As a result, you will receive a token number on your email address given in the PAN Card correction form. Keep this token number safe for future references.

Step 5: Click 'Continue with PAN Application Form'

Now, the applicant needs to click on the 'Continue with PAN Application Form' option.

Step 6: Choose Documents Submission Mode & Fill details

In this step, on the new page, you need to choose the mode of submitting your documents. Fill out the required details and then click on 'Next'.

Step 7: Select check box in Left margin & mention PAN

In this step, under the contact details in your online PAN card correction form, select the check box in the left margin, and mention additional PANs that you need to surrender/cancel, and then click on the 'Next' button.

Step 8: Select & Upload Necessary Documents

Now, select and upload the required documents, such as proof of identity, Date of Birth, Residence, and Copy of additional PAN and submit. Make sure these details are the ones you want to update.

Step 9: Fill Declaration & Submit

Fill out the declaration and submit it.

Step 10: Get Authorized Signatory Sign

In case the PAN Card is to be surrendered is issued in the name of a Company/Partnership Firm, then an authorized signatory must sign the PAN Card form.

Step 11: Make Payment through Available Modes

You will get redirected to the Payment Page. Choose any of Payment Modes: Credit/Debit Card, Demand Draft or Online Banking, to make your payment.

Step 12: Acknowledgement Slip will get Generated

Upon successful payment, an acknowledgement slip will get generated. Save it for future references.

Use the acknowledgement number to check the status of your PAN card cancellation request. It takes around 10-15 days and once the cancellation is done, you will get a confirmation message.

Offline Process for PAN Card Cancellation

If you prefer the traditional method, you can cancel your PAN card offline too. To do so, write a detailed letter to the Assessing Officer of your local tax office for cancellation of your PAN Card. This letter should clearly outline reason for the cancellation of the permanent account number and other details, such as;

• Name of PAN Holder: The letter must contain the correct name as appearing on PAN.
• Address details: The correct residential address should be clearly mentioned in the letter.
• PAN Card details: You also need to mention clear details of the PAN card that you will surrender.

Once you submit the letter, don't forget to get an acknowledgement copy as proof of submission. This will serve as a proof that you have initiated the cancellation process and can be used for follow-ups with Income tax authorities.

Process to Check PAN Card Cancellation Status

• Visit the Income Tax Department e-filing website.
• Choose ‘Verify PAN Status’ under Quick Links option.
• Now, enter your PAN Number, Name, Date of Birth, and Contact Number and then click on the 'Continue' button.
• Enter OTP sent to your registered Mobile and click 'Validate'.
• Now, you can see the status of your PAN Card cancellation on your screen.

The status will show various stages of your application: ‘Under Process’ means your application is under review, ‘Rejected’ means there were errors or issues in your application and ‘Accepted’ means your PAN card cancellation is done successfully. Keep track of the status so that you are informed and can take action if any issues arise. Also, maintain a record of acknowledgement and any communication with tax authorities.

Surrender PAN Card of Deceased Person

In the unfortunate event of the demise of a PAN cardholder, relatives have to surrender that person's PAN card by writing a letter to the Income Tax Officer with all details of the deceased including name, PAN number, date of birth and reason for surrender of card. Attach a copy of the death certificate with the letter to validate the claim so that the PAN card is officially deactivated and cannot be misused. Submit the surrender request by mailing the letter and supporting documents to the concerned tax office. This will ensure that the deceased’s financial identity is managed and closed.

PAN Card Cancellation for Companies and Firms

Companies and firms need to cancel their PAN cards under certain circumstances like dissolution or restructuring. Initiate the process online through NSDL website or offline by returning the PAN card to tax authorities. The steps involved in PAN cancellation process online for a Firm or Company are described below;

Step 1: Visit the NSDL Website.

Step 2: Choose the option 'Changes or Correction in existing PAN data/Reprint of PAN Card' application and enter the required information in the said fields.

Step 3: Enter PAN details that you want to cancel under the 'Mention other Permanent Account Numbers (PANs)'

Step 4: Make Payment and finally submit the form.

Step 5: Now, take printout of the acknowledgement and despatch it along with required documents such as dissolution deed, copy of PAN card and covering letter to the 'Income Tax PAN Services Unit' located at Pune.

In case of offline cancellation of a PAN Card for a company or firm, the applicant needs to write a letter to the Income Tax Officer of the jurisdiction under which the firm/company files taxes. In this letter, mention the clear reason for PAN cancellation of the business entity, which may be dissolution or restructuring of the business. Don't forget to attach the required documents, dissolution deed and a copy of PAN Card to be surrendered. Finally, submit this letter with the necessary documents to the Income Tax Officer and don't forget to take acknowledgement as it may be used for future reference.

After processing the request, the company will receive a notification for the status of cancellation. This will ensure that the company's financial activities are recorded correctly and PAN card is not misused.The penalty for holding multiple PAN cards can be up to 10,000 under Section 272B of the Income Tax Act to ensure compliance and prevent tax evasion or fraud.

Understand the seriousness of holding multiple PAN cards and cancel any duplicate PAN cards immediately to avoid penalties and ensure your financial transactions are smooth and legally compliant.

Pre-Cancellation Checklist

Before you proceed with the cancellation of your PAN card ensure you have all the required documents and information ready. This will help in a smooth process and avoid delays. Here’s a checklist for you:

• Reason for Cancellation: Ensure you have a valid reason for cancellation of PAN card, such as holding multiple PAN cards or having incorrect details on the card.
• PAN Card Number to be Canceled: Have the PAN card number to be cancelled ready.
• PAN Card Number to be Retained: If applicable, note the PAN card number to be retained.
• Proof of Identity: Have valid identity proof like an Aadhaar card, Passport or Driving License.
• Proof of Date of Birth: Ensure you have proof of date of birth, such as a birth certificate or passport.
• Proof of Address: Collect address proof documents like utility bills or bank statements.
• PAN Card Cancellation Form: If applying offline, fill the PAN card cancellation form accurately.

Note: Having these documents and information ready beforehand will help in a hassle-free PAN card cancellation process.

Tips for Smooth Cancellation of PAN Card

For smooth cancellation of PAN Card; be it offline or online, certain things must be kept in mind. Following such things can ensure smooth application submission as well as verification of cancellation process. For smooth PAN card cancellation follow these tips:

• Valid Reason: Ensure you have a valid reason for cancellation of PAN card like holding multiple PAN cards or incorrect details.
• Accurate Form Filling: Fill the PAN card cancellation form correctly and accurately to avoid delays or rejections.*
• Attach Documents: Ensure all documents and proofs are attached to the application.
• Correct Submission: Submit the form and documents to the correct address or online portal specified.
• Keep Acknowledgment: Retain a copy of the acknowledgment receipt or confirmation message.
• Regular Status Check: Check the PAN card cancellation status regularly to ensure the process is smooth.
• Update Records: Once cancelled, update your records and notify banks and financial institutions about cancelled PAN cards.

By following these tips and guidelines you can have a smooth and hassle free PAN card cancellation process, without any issues or delays. To cancel your PAN Card, consult Setindiabiz Experts to get it done properly.

Conclusion

In summary, cancelling a PAN card online or offline is a simple process if you follow the right steps and submit the required documents. It’s important to comply with the law to avoid penalties and your financial transactions to be in order. Understand the importance of having only one PAN card and how to cancel the duplicates, you can avoid legal issues and streamline your tax related activities. Take control of your financial identity and be compliant with the law.

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Editorial Team | in

Setindiabiz Editorial Team is a multidisciplinary collective of Chartered Accountants, Company Secretaries, and Advocates offering authoritative insights on India’s regulatory and business landscape. With decades of experience in compliance, taxation, and advisory, they empower entrepreneurs and enterprises to make informed decisions.