Is it Mandatory to Have a PAN for a Partnership Firm?

Posted by Corpbiz Legal on March 17th, 2021

Partnership firms are created by two or more parties who are in agreement to share the profits, loss and responsibilities incurred by a business. The partners give consent to do so over a written or oral agreement known as a partnership deed. Given that a verbal agreement has no legitimacy for tax purposes most of the partnership firms form a written, legally compelling partnership deed in place before commencing the business. The Partnership Firm Registration, regulation and working come under the provisions of the Indian Partnership Act, 1932. However, to pay taxes, a partnership firm has to get registered with the Income Tax Department and should have a valid PAN card. PAN card is the most essential article a business and a person have to obtain and in case of partnership firm registration PAN card is mandatory. In this article, we will focus on how the PAN card is valuable for a partnership firm.

PAN Card requirements for Partnership Firm Registration

To be qualified to file Income Tax returns, a partnership firm has to submit the partnership deed and PAN card to the Income Tax Department. Partnership Firms can obtain a PAN Card through applying in form 49A. Nonetheless, before applying for a PAN card, a firm should complete certain formalities. Here you can look at what a partnership firm has to do before applying for a PAN card.

• Draft and appropriately notarize the partnership deed from a public notary.
• Describe and sanction one partner to act as the Manager of the firm and can also sign on behalf of the firm.
• State the date of formation of the partnership firm and also the place of business in the partnership deed.
• Make sure that every page of the partnership deed is duly signed by all the partners and two witnesses.
• Stamp and sanction the partnership deed using a stamp that has the name of the firm along with the word -partner.

Documents requisite for PAN card in case of Partnership Firm Registration

Following are the documents required to acquire a PAN card in case of Partnership Registration:

• Partnership Deed
• Digital signature certificate (DSC)
• Proof of Residence of the registered office:
• Sale Deed
• Rental agreement
• NOC from the owner
• Utility bills (not older than three months)
• Identity Proof of partners
• Proof of address of all partners
• Certificate of Registration

What is the Online Application Process for obtaining PAN Card?

Here’s how you can apply online through the IT Department’s website.

• First visit the official online portal of the NSDL.
• On the home page, press on the New PAN or Form 49A option.
• Ensure that you read all the instructions carefully before filling the application form.
• Opt for Firm as it is your category and submit the other details.
• In case if an error occurs in the format, a reply will be generated representing the errors.
• Then you must make the requisite changes and re-submit the application form.
• Next step is to select a mode of payment from amongst DD, Debit or credit card, cheque and net banking and make the payment of Rs. 105.
• After the process is duly completed, print-out the confirmation slip and attach a recent passport size photo on the confirmation slip and attest the slip with a black pen.
• The final step is to send confirmation receipt to the IT Department along with the other essential documents within time period of fifteen days.

Application details of PAN Card for Partnership Firm Registration

Here are the details you are required to fill the application form for obtaining PAN card as a partnership firm:

• Name of the partnership firm as stated in the Registration Certificate with an M/S tag.
• Date of incorporation of firm as stated in the partnership deed.
• Registered address of the office as per the partnership deed.
• Opt for Partnership Firm in status of application form.
• Select income from the business as the source of income on the application form.
• Select apposite business code.
• Mention all the essential documents that are required to be submitted as proof.
• In the Declaration, state the name of the authorised partner.
• At the end state the place and date.

Conclusion

The Partnership firm registration, regulation and working come under the provisions of the Indian Partnership Act, 1932. However, to pay taxes, a partnership firm has to get registered with the Income Tax Department and should have a valid PAN card. PAN card is the most essential article a business and a person have to obtain and in case of partnership firm registration PAN card is mandatory.