When two or more parties decide to collaborate to perform business activities under the terms set forth in the partnership agreement, a partnership company is created. The best feature of this corporate structure is that no one member will be accountable for paying for the total loss a company experiences. Since a verbal agreement is useless for tax purposes, most enterprises establish a formal, legally recognized agreement before starting the business.
PAN Card.
PANs are used nationwide to identify various taxpayers. Indians receive a pan card, a 10-digit unique identity alphanumeric number, typically if they pay taxes.
The computer-based PAN system of identification assigns a unique identification number to any entity that pays taxes in India. This method involves storing a person's whole tax-related data against a single PAN, which is a crucial key for information storage. No two individuals in tax-paying organizations may have the same PAN since this is shared across the country.
Are Pan Cards Required For Partnership Firms?
All partnership firms in India are governed under the Indian Partnership Act of 1932. Everyone who has joined the partnership is obliged to have a pan card for partnership firm because Section 4 makes it clear that a partnership is a relationship between two people who have agreed to split the profits from an operated firm. When filing an income tax return, the PAN Card form 49A and the certificate of registration or partnership agreement, which serve as proof of the firm's existence, must be included.
Formalities Before Applying for a PAN Card
Before requesting the pan card for the partnership firm, the partners of the partnership firm must fulfil the following formalities:
- Properly notarize the company's partnership agreement using a public notary.
- Define and grant one partner the power to sign on behalf of the company as manager (authorized partner).
- Make sure the partnership deed includes information on the partnership firm's establishment date and place of business.
- Make sure that all of the firm's partners and two extra witnesses sign each page of the partnership deed.
- Use a rubber stamp with the name of the partnership firm and the phrase "partner" to affix it to the partnership deed.
Documents Required for Application of Pan card for partnership firm:
- Deed of partnership.
- Certificate for digital signatures (DSC) from the authorized partner.
- Utility bills that are no more than three months old or a leasing agreement, sale title, and NOC from the owner are acceptable forms of proof for the office's address.
- Proof of each partner's identity.
- Proof of all partners' addresses.
- Registration certificate for the partnership firm.
Process for filing an application for a PAN Card for Partnership Firm
The authorized partner has the option of applying online or in person for a PAN card for partnership firm. Below is a description of the PAN application procedure.
- Visit the NSDL's official website.
- Choose the 'New PAN - Indian Citizen (Form 49A)' option from the page's drop-down list under the 'Application Type' option.
- Choose the 'Firm' option from the drop-down list under the 'Category' option.
- Fill out the application form with the applicant's contact information, partnership firm income information, business number, and supporting documentation.
- Make the payment of Rs. 110 using your choice of a credit or debit card, DD, check, or net banking.
- Take a printout of the acknowledgement slip after the payment has been made.
- Attach the authorized partner's most recent passport-sized photo to the acknowledgement sheet and sign it with a black pen to confirm it.
- Within 15 days of submitting the application online, send the acknowledgement slip and the necessary papers to the Income Tax Department.
- Within 15 to 20 days of verifying the paperwork, the PAN card will be sent to the partnership firm's registered office.
Offline Mode of PAN Card Application
- Get the PAN application form by going to the nearby PAN Center (TIN-FC office) (Form 49A).
- The PAN application form is also available for download on the TIN website.
- Utilizing a black ballpoint pen, complete the application.
- The form must be signed by the authorized partner.
- Send the application form, the necessary paperwork, and the Rs. 110 registration money to the TIN-FC office.
- Within 15 to 20 days of the paperwork being verified, the PAN card will be delivered to the partnership firm's registered office. Through the acknowledgement number they were given after submitting the registration form, the partners can check the status of their PAN cards online.
Application for a PAN Card for Partnership Firms
The following information must be provided by the partner on a PAN application form (Form 49-A) in order to get the PAN card for partnership firm:
- Name of the partnership firm as it appears in the applicant name section of the Certificate of Registration for firms with an M/S issued by the Registrar of Firms.
- According to the partnership deed, the firm was incorporated on this date.
- According to the partnership document, the company's office address.
- Select "Partnership Firm" from the list of applicant statuses.
- The firm's registration number is listed in the partnership deed.
- Select "Income from business or profession" from the list of possible sources of income.
- Select the relevant business code depending on the nature of the partnership firm's operations.
- Mention all the proof-submitting materials that must be delivered to the TIN-FC office or Income Tax Department, along with the application form and acknowledgement slip (if submitted online).
- Mention the authorized partner's name in the declaration section.
- The authorized partner must sign the application form.
