• The Cabinet Committee on Economic Affairs (CCEA), chaired by Prime Minister Narendra Modi, has given its approval for the PAN 2.0 Project of the Income Tax Department with a financial outlay of Rs 1,435 crore.

• The PAN 2.0 Project enables technology-driven transformation of taxpayer registration services.

The benefits include:

i) Ease of access and speedy service delivery with improved quality.

ii) Single source of truth and data consistency.

iii) Eco-friendly processes and cost optimisation.

iv) Security and optimisation of infrastructure for greater agility.

• The PAN 2.0 Project resonates with the vision of the government enshrined in Digital India by enabling the use of PAN as Common Identifier for all digital systems of specified government agencies.

• PAN 2.0 Project is an e-governance project for re-engineering the business processes of taxpayer registration services through technology-driven transformation of PAN/TAN services for enhanced digital experience of the taxpayers.

• This will be an upgrade of the current PAN/TAN 1.0 eco-system consolidating the core and non-core PAN/TAN activities as well as PAN validation service.

• Currently, about 78 crore PANs have been issued, of which 98 per cent are to individuals.

What is PAN?

• PAN is a ten-digit unique alphanumeric number issued by the Income Tax Department to a person, firm or entity. PAN is issued in the form of a laminated plastic card.

• PAN enables the department to identify/ link all transactions of the PAN holder with the department. These transactions include tax payments, TDS/TCS credits, returns of income, specified transactions, correspondence, etc, and so on.

• It facilitates easy retrieval of information of PAN holder and matching of various investments, borrowings and other business activities of PAN holder.

The ten characters of PAN

Out of the first five characters, the first three characters represent the alphabetic series running from AAA to ZZZ.

The fourth character of PAN represents the status of the PAN holder.

This means:

• P for Individual

• C for Company

• H for Hindu Undivided Family (HUF)

• A for Association of Persons (AOP)

• B for Body of Individuals (BOI)

• G for Government Agency

• J for Artificial Juridical Person

• L for Local Authority

• F for Firm/ Limited Liability Partnership

• T for Trust.

Fifth character of PAN represents the first character of the PAN holder’s last name/surname in case of an individual. In case of non-individual PAN holders, fifth character represents the first character of PAN holder’s name.

Next four characters are sequential numbers running from 0001 to 9999.

Last character — the tenth character — is an alphabetic check digit.

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