PAN Quoting requirements under Draft Income-tax Rules, 2026
PAN Quoting Requirements Under Draft Income-tax Rules, 2026: Complete List of Mandatory Transactions and Revised Thresholds
Complete List of Mandatory Transactions + New Proposed Changes (Draft Rules 2026)
Permanent Account Number (PAN) quoting is governed primarily by:
- Section 139A of the Income-tax Act
- Rule 114B of the Income-tax Rules
- Specified Financial Transaction (SFT) reporting framework
The Draft Income-tax Rules, 2026 propose rationalisation of thresholds and inclusion of certain additional transaction triggers.
This guide consolidates:
- Existing mandatory PAN quoting transactions
- Revised limits proposed in Draft Rules 2026
- Newly introduced reporting triggers
PART 1 — EXISTING PAN QUOTING TRANSACTIONS (Current Framework)
Below is the consolidated list under Rule 114B (existing structure).
A. Banking & Cash Transactions
| Transaction | Current PAN Requirement |
|---|---|
| Cash deposit in bank/post office (in a financial year) | ₹10 lakh or more |
| Cash deposit/withdrawal in current account (FY) | ₹50 lakh or more |
| Time deposit (FD/RD) | ₹5 lakh or more (other than renewal) |
| Cash deposit in a single day (older structure trigger) | ₹50,000 or more |
| Opening bank account | PAN mandatory |
| Opening post office account | PAN mandatory |
B. Credit Card Transactions
| Transaction | Threshold |
|---|---|
| Application for credit card | Mandatory |
| Cash payment against credit card bill | ₹1 lakh or more |
| Non-cash payment against credit card bill | ₹10 lakh or more (FY aggregate) |
C. Investment & Securities Transactions
| Transaction | Threshold |
|---|---|
| Purchase of mutual fund units | ₹50,000 or more |
| Purchase of bonds/debentures | ₹50,000 or more |
| Purchase of shares (other than through stock exchange) | ₹1 lakh or more |
| Opening demat account | Mandatory |
| Purchase of RBI bonds | ₹50,000 or more |
D. Property Transactions
| Transaction | Current Threshold |
|---|---|
| Sale or purchase of immovable property | ₹10 lakh or more or stamp duty value |
| Registrar reporting under SFT | ₹30 lakh or more |
PAN required for both buyer and seller.
E. Motor Vehicle Purchase
PAN required for purchase or sale of motor vehicle (other than two-wheelers in earlier rule interpretations).
F. Cash Purchase of Goods/Services
| Transaction | Threshold |
|---|---|
| Cash purchase of goods/services | ₹2 lakh or more |
G. Hospitality & Foreign Travel
| Transaction | Threshold |
|---|---|
| Cash payment to hotel/restaurant | ₹50,000 or more |
| Foreign travel expenditure | ₹50,000 or more |
H. Insurance Premium
| Transaction | Threshold |
|---|---|
| Life insurance premium | ₹50,000 or more (FY) |
PART 2 — PROPOSED CHANGES UNDER DRAFT INCOME-TAX RULES, 2026
The Draft Rules aim to rationalise thresholds and move from transaction-wise triggers to aggregate monitoring.
Below are key proposed changes:
1. Cash Deposit / Withdrawal — Annual Aggregate System
Old Rule: PAN required for cash deposits exceeding ₹50,000 in a single day.
Proposed Rule 2026
PAN required where:
Aggregate cash deposits OR aggregate cash withdrawals exceed ₹10 lakh in a financial year (across accounts)
🔹 Proposed Limit: ₹10,00,000 (annual aggregate)
Shift: Daily trigger → Annual aggregate tracking
| Basis | SFT Reporting Limit | PAN Quoting Rule |
|---|---|---|
| Savings Account | ₹10 lakh deposit | ₹10 lakh deposit OR withdrawal |
| Current Account | ₹50 lakh deposit | ₹10 lakh (aggregate, may apply across accounts) |
| Purpose | Bank reports to ITD | Customer must quote PAN |
| Focus | Deposit only | Deposit + Withdrawal |
2. Motor Vehicle Purchase — Value Based Trigger
Old Structure: PAN broadly required for motor vehicle purchase.
Proposed Rule 2026
PAN required only where:
Purchase value exceeds ₹5 lakh (including two-wheelers)
Agricultural tractors excluded
🔹 Proposed Limit: ₹5,00,000
Impact: Small vehicle purchases get relief.
3. Immovable Property — Threshold Increase
Old Rule: PAN required where value exceeds ₹10 lakh.
Proposed Rule 2026
Threshold increased to:
₹20 lakh
🔹 Proposed Limit: ₹20,00,000
Reason: Alignment with current real estate values.
4. Hotel / Restaurant / Event Payments
Old Rule: PAN required for cash payment exceeding ₹50,000.
Proposed Rule 2026
Threshold increased to:
₹1 lakh (cash)
🔹 Proposed Limit: ₹1,00,000
5. Insurance Sector — New Account-Based Trigger
Old Rule: PAN required only when premium exceeds ₹50,000.
Proposed Rule 2026
PAN required:
At the time of commencement of account-based relationship with insurer
This means PAN may be required even if premium is below ₹50,000.
Shift: Transaction threshold → Relationship-based compliance.
PART 3 — COMPLETE CONSOLIDATED LIST (After Proposed Changes)
If draft rules are implemented, PAN quoting will be mandatory for:
✔ Aggregate cash deposits/withdrawals exceeding ₹10 lakh (FY)
✔ Current account cash transactions exceeding ₹50 lakh (FY)
✔ Time deposits exceeding ₹5 lakh
✔ Property transactions exceeding ₹20 lakh
✔ Motor vehicle purchase exceeding ₹5 lakh
✔ Cash purchase of goods/services exceeding ₹2 lakh
✔ Hotel/restaurant/event cash payment exceeding ₹1 lakh
✔ Foreign travel expenditure exceeding ₹50,000
✔ Credit card application
✔ High-value credit card payments
✔ Mutual fund/bond/share investments above prescribed thresholds
✔ Opening bank/demat accounts
✔ Insurance account onboarding
PART 4 — Why These Changes Matter
The system now integrates:
PAN → Reporting Entity → SFT → AIS → ITR Matching
Once PAN is quoted:
- Transaction is captured
- It appears in AIS
- It is compared with income declared in ITR
- Risk profiling happens automatically
Mismatch example: Income declared: ₹6 lakh; AIS shows: ₹22 lakh property purchase
System may flag discrepancy.
PART 5 — Practical Advisory for Taxpayers
- Do not split transactions to avoid threshold — aggregate monitoring exists.
- Ensure source of funds is documented.
- Review AIS before filing ITR.
- Maintain consistency between income profile and financial activity.
- Keep PAN operative and Aadhaar linked.
Final Conclusion: Draft Income-tax Rules, 2026 do not eliminate PAN compliance — they restructure it.
The approach is:
✔ Higher limits for inflation adjustment
✔ Aggregate annual monitoring
✔ Expansion into relationship-based reporting (insurance)
✔ Data-driven tax analytics
Once notified, these rules are expected to apply from FY 2026-27 onward.
Also Read: Consolidated TDS & TCS Guide under Income-tax Act 1961 vs Income-tax Act 2025
Read More: Union Budget 2026 – CA Cult
