Difference between NRI PAN Card & Normal PAN Card

When you're figuring out the NRI PAN card vs normal PAN card situation, it's like looking at two sides of the same coin. On one side, the "Normal PAN card" is what people living in India use. It's like a financial passport for everything from paying taxes to buying a mobile phone plan.

Flip the coin, and on the other side, you have the "NRI PAN card" for Indians living abroad. They might be working abroad or running a business, but they still need a link back to India's financial system, especially if they have money matters to take care of back home.

So, really, when we talk about the difference between a normal PAN card and an NRI PAN card, we're talking about the same thing, just with a different label depending on where you call home. It's all about ensuring everyone, whether they live in India or elsewhere, can jump into India's financial pool without hiccups.

What is an NRI PAN card?

An NRI PAN card is essentially a tax identity issued to Indians who aren’t residing in the country. It’s tailored for the Non-Resident Indians who may be spread across the globe for various reasons such as work, education, or residence.

While the PAN (Permanent Account Number) remains the same in structure and validity as any PAN card, it is assigned to NRIs who must undertake financial or investment activities in India.

This includes buying property, handling investments, managing bank accounts, or any transaction that requires a tax account number in India. The NRI PAN Card ensures that despite their physical absence from India, NRIs remain within their home country's financial and taxation loop.

What is a Normal PAN card?

A Normal PAN card, on the other hand, is issued to individuals who are Indian citizens and are residing within the borders of India. It is a personal identification number that binds the financial transactions and tax-related activities of Indian residents to a single, traceable thread. This includes receiving a salary, purchasing assets, banking transactions, or any activity that involves monetary transactions taxable under Indian law.

NRI PAN card vs Normal PAN card: Key differences

The dividing line between the two variants of PAN cards is primarily drawn around the applicant's residency status. Here are the key differences:

Benefits of having a PAN Card

A PAN card is vital for several reasons:

• Simplified Transactions: Essential for property deals, stock market investments, and mutual fund engagements.
• Tax Management: Serves as a unique identifier for tax filings and tracking financial records.
• Identity Verification: Recognised universally as reliable proof of identity across various services.

Importance of an NRI PAN card

Apart from the above-mentioned benefits, NRIs benefit from having an NRI PAN card as below:

• Compliance with tax laws: An NRI PAN card ensures that Non-Resident Indians comply with the Indian tax regulations concerning their income from India. This is crucial for NRIs as it affects their tax liabilities and legal standing with Indian financial institutions.
• Facilitation of financial investments: NRIs with a PAN card can seamlessly invest in Indian stock markets, mutual funds, and other financial instruments, which could potentially offer better returns compared to other markets.
• Property management: Buying or selling property in India requires an NRI with a PAN card. This document is vital in executing such transactions legally and smoothly.
• Ease in banking operations: To open NRO (Non-Resident Ordinary) and NRE (Non-Resident External) accounts in Indian banks, NRIs need a PAN card. These accounts are essential for managing earnings in India and abroad.

Application process: Difference between an NRI PAN Card and a Normal PAN card

Applying for a PAN Card is a straightforward process for NRIs, designed to be completed easily from anywhere in the world.

For NRIs, the steps include:

1. Initiating the application on the TIN-NSDL website.
2. Fill in Form 49A completely, ensuring all documents are uploaded.
3. Attaching digital copies of identification, address proof, a recent photograph, and proof of age.
4. Processing the application fee payment.
5. Printing the acknowledgement receipt to monitor the application status.

For Resident Indians, the application process as below:

Offline application:

1. Similar to NRI applicants, resident Indians begin by completing the initial three steps of the process.
2. All documents must be uploaded, and the application form must be signed in the designated places.
3. The completed form and accompanying documents can be dispatched to specified PAN service centres listed on the official website, along with the cheque or demand draft processing fee.

Online application:

1. Resident Indians start by accessing the NSDL website.
2. They enter their Aadhaar number as part of the verification process.
3. The online form is filled out carefully, ensuring all details are accurate before submission.
4. The application fee is to be paid online.
5. An acknowledgement number, typically 15 digits, is issued, which is used to keep track of the application progress.

Documents required for PAN card in India

Securing a PAN card in India necessitates gathering a set of official documents to establish your identity, address, and age for a smooth application process.

• Proof of Identity: Any one of the following
• Voter ID card copy
• Passport copy
• Driving license copy
• Aadhaar card copy
• Pensioner card copy
• Proof of Address: Any one of the following
• Recent utility bill (electricity, landline, gas, etc.)
• Passport copy (if it contains the address)
• Driving license copy
• Domicile certificate issued by the government
• Bank passbook or bank account statement
• Proof of Date of Birth: Birth certificate, matriculation certificate, or passport.
• Photographs: Two recent passport-sized photographs.

Documents required for NRI PAN card

NRIs must furnish specific documentation proving their identity and overseas residency to acquire an NRI PAN card, linking them to India’s financial system.

• Proof of Identity: Copy of your passport.
• Proof of Overseas Address: Any one of the following
• Copy of bank account statement in the country of residence
• NRE (Non-Resident External) bank account statement in India
• Copy of residence permit in the country of residence, attested by the Indian Embassy/Consulate/High Commission
• Overseas driving license
• Government-issued ID card indicating the nationality or residence status
• Proof of NRI Status: OCI or PIO card, if applicable.
• Photographs: Two recent passport-sized photographs.

Also Read: Know about NRO Account taxation to secure your Indian income

Conclusion

Whether you're an NRI looking to invest back home or a resident managing finances within India, holding the appropriate PAN card simplifies your financial transactions and legal obligations.

In support of this journey, Axis Bank offers tailored services such as the NRE account, allowing you to deposit foreign earnings and enjoy tax-free interest in rupees. For income generated within India, Axis Bank's NRO account is an excellent option for managing your finances and consolidating your savings.

Disclaimer: This article is for information purpose only. The views expressed in this article are personal and do not necessarily constitute the views of Axis Bank Ltd. and its employees. Axis Bank Ltd. and/or the author shall not be responsible for any direct / indirect loss or liability incurred by the reader for taking any financial decisions based on the contents and information. Please consult your financial advisor before making any financial decision.