What is PAN (permanent account number)?

Almost every formal business activity runs through the permanent account number: issuing bills, opening a current account in the business name, bidding for work, filing income tax, and having tax withheld correctly when somebody pays you.

A business registered for PAN only does not charge VAT on its sales. It also cannot reclaim the VAT it pays on its own purchases, so that input tax stays in its costs. This is the cost of staying outside the VAT system.

VAT registration is a second, separate registration added on top of the PAN. Nothing is taken away when you register. Your income tax obligations continue, and the same number still identifies you. Which registration your business needs depends on turnover and on your trade, so confirm your position with the IRD or your accountant.

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