PAN
The Permanent Account Number, a ten-character identifier issued by the income tax department and mandatory for securities transactions.
How it is identified
Test: the ten-character alphanumeric identifier is quoted and linked for every securities market transaction and tax filing
Unit
qualitative
In depth
The PAN is the key that links an investor's holdings, transactions and tax records across brokers, fund houses and depositories, which is what makes the consolidated account statement and the annual information statement possible. It is mandatory for opening a demat account, buying mutual funds and filing returns. Failure to link PAN with Aadhaar renders it inoperative, which blocks transactions and causes tax to be deducted at a higher rate. Because it aggregates everything, tax authorities see reported transactions across intermediaries whether or not the investor reports them.
Worked example
An investor's equity trades across three brokers and mutual fund holdings across five fund houses all appear against one PAN. The annual information statement compiles them, which is why omitting one from a return is visible.
Illustrative figures, chosen so the arithmetic is easy to follow. Not a live price and not a valuation of any company.
Educational reference only
This entry explains what “PAN” means. It is not investment advice and not a recommendation to buy or sell any security. Any numbers above are illustrative, not live prices, and nothing here predicts price direction or rates a stock. Consider your own circumstances and consult a SEBI-registered investment adviser before acting.