Know Your (Essential) Documents

GONE ARE THE DAYS when you needed an identity proof only on a few occasions. Today, you might be asked for your PAN when you pay Rs.50,000 or more in cash for your hotel bills, expensive watches or air tickets. In a move to curb black money, the government has now made it mandatory to quote your PAN for all transactions over Rs.2 lakh. Then there is the Unique Identification Authority of India's (UIDAI) Aadhaar. Despite the Supreme Court's ruling that Aadhaar is purely voluntary, the Gujarat government passed a resolution this July, making it compulsory for students appearing for their secondary and higher secondary examinations. In Andhra Pradesh, too, it is a must for road transport authority transactions such as vehicle registration certificates, learner's licence, permanent driving licence and a change of ownership.Here is the low-down on essential documents and their uses.

AADHAAR CARD

Issued by: Unique Identification Authority of India (UIDAI)

Purpose: The main purpose is to create a unique, universal identity for Indian citizens that would negate the need for different documents to avail of various services. It is, therefore, a document that can be used to prove one's identity and address anywhere in India.

What is it? It is a random 12-digit number used to establish your identity on the basis of demographic and biometric information. It is equivalent to the social security number in the US. Translated to mean 'foundation' or 'support', the Aadhaar number assigned is valid for life.

Usages: While Aadhaar ensures that the direct benefit transfer (DBT) schemes offered by the government help those who are eligible to gain from them, even if you are not a beneficiary, it is worth getting a number. You can use it for:

1. e-KYC: Aadhaar-based e-KYC is a paperless process that allows you to fulfil the KYC formalities for online investment in mutual funds. You would need your Aadhaar number, PAN, Aadhaar-registered mobile number and email ID. Also, SEBI permits investment of only Rs.50,000 in a financial year per mutual fund through Aadhaar-based e-KYC, using a one-time password verification.
2. Online income tax return (ITR) submission: E-verify your ITR form provided your mobile number is registered in the Aadhaar database.
3. Passport: Get a fresh passport in three days by submitting a copy of your Aadhaar card along with copies of your voter ID and PAN card.
4. DigiLocker: This allows a dedicated 10 MB cloud storage space linked to the Aadhaar number of an individual. You can store important documents such as mark sheets and PAN card in a digital locker (digilocker.gov.in). If all your information is linked, you can request government organizations or other entities registered with DigiLocker to send you electronic copies of documents and certificates (such as driving licence, voter ID or school certificates), directly into your account. You can even upload documents and sign them digitally using the e-sign facility. You also get secure access to documents issued by the government through a web portal and mobile application for residents.
5. Digital life certificate or JeevanPramaan scheme for pensioners: A digital certificate eases the verification process for pensioners. It is generated through Aadhaar-based biometric authentication, which gets stored in the life certificate repository.
6. Scholarships: A student seeking a scholarship or fellowship from state governments or the University Grants Commission must possess an Aadhaar number.

DRIVING LICENCE

Issued by: Regional Transport Office

Purpose: It certifies that a person is qualified to drive a vehicle. It also serves as identity and address proof. Driving without a licence is a crime and you could be penalized for it. It needs to be renewed periodically.

What is it? A driving licence is issued by individual states through their regional transport offices. For gearless motorcycles, the minimum age for getting a licence is 16 years. It is 18 years for other types of vehicles.

Usage: The insurance company can reject your claim in case of driving without a valid licence.

PAN CARD

Issued by: Income Tax Department

Purpose:Enables the income tax department to identify and link all transactions of the PAN holder with the department, so as to prevent tax evasion and widen the tax base.

What is it?Permanent account number, or PAN, is a 10-digit alphanumeric number used to track your financial transactions (income, investments, borrowing, big spending and tax payments).

Usage: Transactions where PAN is required include:

TDS: Banks can deduct tax at a higher rate of 20 per cent if you do not provide your PAN. Only 10 per cent is deducted if the bank has your PAN details.

Buying property: PAN is mandatory for buying and selling immovable property in India. NRIs can also easily buy property or engage in business in India with the help of a PAN without filing tax returns.

Mandatory quoting of PAN:

• For buying goods or services over Rs.2 lakh, including gold
• During purchase/sale of immovable property exceeding Rs.10 lakh
• For mobile wallet transactions of more than Rs.50,000
• For opening a bank account, except Jan Dhan account
• For cash payment of hotel/restaurant bill above Rs.50,000
• For cash deposit in bank exceeding Rs.50,000 in a single day
• To purchase foreign currency or make cash payment while travelling abroad exceeding Rs.50,000
• For investments over Rs.50,000 in mutual funds/debentures/RBI bonds/life insurance policy
• To open a demat account
• For businesses or professions where total sales, turnover or gross receipts exceed or are likely to exceed Rs.5 lakh
• For buying or selling motor vehicles (other than two-wheelers)
• The Pension Fund Regulatory and Development Authority has started using PAN apart from Aadhaar for online registration under the National Pension System.

PASSPORT

Issued by: Ministry of External Affairs

Purpose: A passport is needed to travel abroad. It also serves as identity and residence proof. It needs to be renewed periodically.

What is it? It is a proof of identity, has your birth date, as well as residential address. It takes care of most of your requirements.

Visa-free travel: Many countries allow visa-on-arrival such as Thailand or visa-free travel such as Nepal if you have a valid passport.

VOTING CARD

Issued by:Election Commission of India

Purpose: It makes you eligible to vote.

What is it? Apart from allowing you to vote, it is also used as identity and residence proof.

With additional reporting by Mamta Sharma

Adapted from Money Today. Copyright 2016 LIVING MEDIA INDIA LIMITED.