Bankers insist on COVID orphan children to produce PAN Card for tax exemption

Kakinada: Children who have lost both parents in the Covid19 pandemic are facing serious taxation travails. Banks are insisting on production of PAN Card for tax exemption vis-à-vis the government compensation the beneficiaries get. Else, banks are telling the guardians they would cut nearly Rs5,000 as income tax from the accounts of orphans.

This is posing a hurdle for the children and their guardians when they go to withdraw money.

The state government is giving Rs10 lakh as compensation for each children or teenager below age 18 who have lost their mother and father.

The government is directly putting the money as Fixed Deposit in these beneficiary accounts and the guardian can draw the interest amount to take care of the children by way of providing them nutritional food, education and medical care.

In East Godavari, 16 such children out of a list of 30 already got the amounts in their bank accounts. Banks will credit the interest amount once every three months. The time to draw the interest amount has come as the money remained in these accounts for the past three months.

“Now the bankers are insisting on PAN Cards’’ for scrutiny and income tax deduction. Otherwise, Rs5,000 would be deducted from the account as income tax. Today we submitted a PAN Card to the banker,’’ said Pushpalatha, paternal aunt of Vaddi Saranya who lost both father Babji and mother Achutha Kumari.  Babji’s father Subba Rao, a security guard, is looking after Saranya.

The government made a fixed deposit of Rs10 lakh into the account of Saranya in May last.

Many of the guardians of the orphaned children are worried that if they submit the PAN Card or if an amount is deducted by way of income tax from the account,’ they might in future lose their white ration card and its benefits given to the Below Poverty Line (BPL) families.

They have requested the government to give exemption to orphan children and their guardians from the provision for production of PAN Cards.

Meanwhile, there was procedural delay for these children and guardians in opening accounts in banks. District child protection unit officer Venkata Rao told Deccan Chronicle that the income tax issue would be taken up with the higher authorities for resolution.

The Rs10 lakh compensation will be go to more than 14 orphaned children in the district.