SIMPLY PUT

Q: Do NRIs need/are eligible for an Aadhaar card? A: There is a lot of debate about this issue. It is not compulsory to have an Aadhaar card for NRIs; however, it is recommended that an NRI should have an Aadhaar card as the government is making it mandatory for a number of transactions. Section 139AA of the Income-tax Act, 1961 as introduced by the Finance Act, 2017 provides for mandatory quoting of Aadhaar/ Enrolment ID of Aadhaar application form, for filing of return of income and for making an application for allotment of Permanent Account Number with effect from July 1, 2017.

It is clarified that such mandatory quoting of Aadhaar or Enrolment ID shall apply only to a person who is eligible to obtain Aadhaar number.

As per the Aadhaar (Targeted Delivery of Financial and Other Subsidies, Benefits and Services) Act, 2016, only a resident individual is entitled to obtain Aadhaar. Resident as per the said Act means an individual who has resided in India for a period or periods amounting in all to 182 days or more in the 12 months immediately preceding the date of application for enrolment. Accordingly, the requirement to quote Aadhaar as per section 139AA of the Income-tax Act shall not apply to an individual who is not a resident as per the Aadhaar Act, 2016. Moreover, filing details of the Aadhaar number while submitting income tax returns from July 2017 does not apply to NRIs.

Q: Do NRIs need a PAN card? A: • PAN Card is required by an NRI if he/she has got a taxable income in India.

• According to a new rule of the Securities and Exchange Board of India (Sebi), any NRI not having PAN card cannot do share trading by depository or broker.

• PAN is also mandatory for an NRI if he/she would like to invest in mutual funds.

• If an NRI doesn’t want to trade but wants to purchase some land or other property in India, then it is mandatory to have a PAN card issued by the government of India.

• A person is required to quote his PAN card while executing many transactions in India, for example opening an NRO bank account, investment in shares, mutual funds, filing return of income, property deals, vehicle deals, investment in bank FDs, etc.

• Section 139A (5B) of the Indian income tax act requires banks in India to mandatorily quote the permanent account number (PAN) in the TDS certificate.

• The Central Board of Direct tax sent a circular on May 13, 2011, stating that from the financial year 2011-2012, all forms 16A will be generated online and address of delivery will be captured from the address on your PAN card application form. If you don’t have a PAN card, it could result in the following: • 1. Non-receipt of Form 16A • 2. Non-issuance of Form 16A