Past Savings A/C without PAN details - Plz Suggest - Income Tax

muraligopoavarapu (article student) (63 Points)
Replied 02 January 2011

hello friend happy new year

Transfer of funds from one bank account to another bank account is not amounts to income.

so that there no tax on transfer of funds from one bank to another.

itwill not be considered asyour income this year.

interest is taxable.

interest income is other income as you are salaried person.

it is taxable in income from other sources in IITR

U S Sharma (glidor@gmail.com) (21063 Points)
Replied 02 January 2011

old savings balance prior to obtaining a PAN are not subject to incometax, incometax is applicable on current year income only. you can furnish pan details now to old bank too and continue the banking there too !!

1 Like

sk_1122 (NA) (159 Points)
Replied 02 January 2011

Thanks for the quick Replies :)

Just a few more points to clarify:

1) If I close that A/C and Transfer funds to another a/c, can I be asked to clarify the source of this amount? I mean How will they know that this is past Savings prior to obtaining PAN?

2) What if I continue to use that old A/C without furnishing PAN details? Will I need to show interest earned on that amount in ITR then?

Which is the best option here? Furnish PAN details and Continue to use that account and show the interest earned on this amount in ITR?

Ravikant (Accountax) (6285 Points)
Replied 02 January 2011

1) Salaried class don't have to prepare Balance Sheet / Capital A/c, if you have prepared and shown all your bank accounts balances-then no problem in transferring funds, if you have not shown that old account-don't trf funds.

2) Itz better not to show

Keep that account without PAN with Nominal balance, this account may help you carry out some tranx to save tax..especially Capital gains..

1 Like

ADITHYA S RAO (CEO) (63 Points)
Replied 02 January 2011

1. No need to worry to much about old A/c since you are not Update PAN number for that A/C....

2. Bank people wont Ask Pan details unitl you are going to do cash transaction more than 50000 per day in that account..

3.For small trasaction better to keep that A/C active.... Since opening new account is diificult to open new account...

sk_1122 (NA) (159 Points)
Replied 02 January 2011

Originally posted by : Ravikant Choudhary
	1) Salaried class don't have to prepare Balance Sheet / Capital A/c, if you have prepared and shown all your bank accounts balances-then no problem in transferring funds, if you have not shown that old account-don't trf funds. 2) Itz better not to show Keep that account without PAN with Nominal balance, this account may help you carry out some tranx to save tax..especially Capital gains..

Hi Ravikant,

Thanks for ur reply.

Can you explain - what do you mean by "shown all your bank acounts" ? Do we need to show details of any bank accounts. When we show the interest earned in ITR do we need to mention how much interest is earned from which bank account?

Pardon me if my question seems silly. :P I am pretty new to all this :)

Even I thought that I would let that old a/c continue without PAN details, but How can it benefit me? what kind of transactions can I carry to save tax? any example?

As this is the first yr when I will be filing ITR, so If I furnish PAN details in that a/c and show the interest earned from that a/c in ITR, will this be the perfect solution? Is this ok or can I be queried (by chance) the source of this amount by IT dept in future?

Ravikant (Accountax) (6285 Points)
Replied 02 January 2011

When you prepare your balance sheet you need to show 'Balance with Banks'. In case of salaried class, generally no balance sheet is prepared. In ITR when we show the total interest earned, we should keep the details we need to produce to the I.T.O, in case your case gets picked up for assessment.

Pardoned.

You can hide some of your taxable income. Some carry out tranx of purchase and sale of property of value less than 30 Lakhs and successfully hide the profit (capital gains) earned

First Return: Itz perfect solution. No query from IT Dept.

U S Sharma (glidor@gmail.com) (21063 Points)
Replied 02 January 2011

while computing your balance sheet , u have to show the opening capital which includes the old bank balances and other investments if any, and current year income will get added to old capital , less current year drawings,

yes you have to show the bank interest for current year in current year Profit & loss account of previous banks also. interest income only will get added to current year income.

Akshay Garg (consultancy) (59 Points)
Replied 02 January 2011

do not close ur account......i hv also faced with same dilema.....but ur first a/c don't hv ur PAN.....so it will help in future wen u need to handle some extra cash.....i hope u'understand wat i want u to convey........

sk_1122 (NA) (159 Points)
Replied 02 January 2011

Ok. If I continue using that account without furnishing PAN details, will it be safe to make FDs below 50K in that a/c? For FDs below 50k we dont need to furnish PAN details.