REQUIREMENT OF PAN NUMBER FOR THOSE EARNING LESS THAN RS 50000 P A

[Chandrakant D Gandhi]

My maid has some deposits in the bank, Her annual income including interest on deposits and salary is less than Rs 50000 per annum. Bank is asking for PAN Numner. However I understand that I T department has issued a notificaiton that those having annjualm income of Rs 50000 or less do not need a PAN number.

Please inform what is the correct situation.

[CAGOPALJI AGRAWAL]

If the interest income is 10000/- or more, then she would have to furnish PAN otherwise the bank would deduct TDS @ 20% on interest. You may refer section 206AA of the Income Tax Act.

AI Summary

PAN requirement for bank deposit interest: furnish PAN to avoid higher TDS under section 206AA. When interest income from bank deposits reaches the statutory withholding trigger, the depositor must furnish PAN; otherwise the bank must deduct tax at a higher rate under Section 206AA. Total annual income below a general threshold does not itself exempt a person from providing PAN for interest bearing deposits, and banks will request PAN to determine correct TDS treatment.