What is Permanent Account Number (PAN)? Do we need to renew it each fiscal year?

The Permanent Account Number (PAN) is a unique identification provided to every taxpayer in accordance with Section 78 of the Nepalese Income Tax Act 2058 and Rule 23 of the Nepalese Income Tax Rules 2059. This number is assigned to individuals and entities registered with the Inland Revenue Department, enabling them to file returns, submit statements, and process documents.

As outlined in Rule 24 of the Nepalese Income Tax Act 2059, any alterations in the details associated with the Permanent Account, such as changes in address, must be reported within 15 days of the modification. Following the receipt of the application, a new PAN Certificate reflecting the updated information will be issued to the taxpayer.

While individuals refer to it as Personal PAN, for entities, it is simply known as PAN, as per the categorization established by the Tax Act.

In our upcoming articles, we'll discuss the process of acquiring a PAN for both individuals and entities, including foreign nationals who are not Nepalese citizens. Today, let's address a common query: Is there an annual PAN renewal process?

In reality, there is no need for an annual PAN renewal. Once obtained, your PAN registration remains in effect unless it is formally cancelled. This ensures that you remain a registered taxpayer with the Inland Revenue Department or the respective Tax Payer's office from where you originally obtained the PAN. The responsibilities associated with obtaining a PAN include the timely payment of applicable taxes and the annual submission of tax returns, where applicable. Additionally, it is recommended that all PAN holders obtain a tax clearance certificate.  For detailed steps on obtaining tax clearance certificate for a Personal PAN, refer to our blog post below.

How to obtain Tax Clearance Certificate?

Should you have any questions regarding the Nepalese Income Tax, feel free to reach out to us on TikTok and Instagram with the handle @learnwithnirmalaryal, and on Facebook at @arthabicharnepal. Thank you, and we trust we've been able to address your queries effectively.