Draft Tax Code 2026 PAN Reporting Rules: The Central Board of Direct Taxes CBDT has shared a draft of the new Income tax Rules 2026. These draft rules were released on February 7, 2026. The government has asked people to send their views before the rules are finalised. These rules will support the Income Tax Act 2025, which will start from April 1 2026.
The new draft suggests many changes in how Permanent Account Number PAN must be used in financial transactions. The government wants to make things easier for small and normal transactions. While also at the same time it wants to keep a closer watch on large money deals and heavy cash use.
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Changes in Property Cash
One big change is related to buying and selling property. Right now, PAN is needed if the property value is above Rs 10 lakh. Under the new proposal this limit will increase to ₹20 lakh. This means smaller property deals will not need PAN reporting. The government says this will reduce paperwork for small buyers and sellers but big property deals will still be monitored.
At the same time, cash transactions will face stricter checks. Currently, if someone withdraws Rs 20 lakh or more in cash in one financial year, it is reported. The draft rule lowers this limit to Rs 10 lakh in a year. So if total cash withdrawal crosses Rs 10 lakh then PAN will be required. This step is meant to reduce tax evasion and increase transparency in the banking system.
Insurance Rules
Earlier, PAN was needed only if the yearly premium was more than ₹50,000. Now, the draft says PAN must be given when starting any account based relationship with an insurance company. This means the PAN will be required from the beginning and for all future transactions.
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Vehicle Purchases
Right now the PAN is required for all vehicle purchases except two wheelers. Under the new plan, PAN will be needed only if the vehicle costs more than ₹5 lakh. Expensive motorcycles will be included in this rule. Tractors will not be included. The goal of this is to reduce paperwork for cheaper vehicles while keeping watch on costly purchases.
For hotels events and other hospitality spending the cash payment limit for PAN reporting will increase. Right now, PAN must be given for cash payments above ₹50,000 per transaction. The new draft raises this limit to ₹1 lakh, this means only higher spending will need PAN details.
These draft rules overall cover many areas like property deals, vehicle purchases, insurance accounts, cash withdrawals, and hospitality payments. The CBDT wants feedback from people until early March. After that the final rules will be announced.
