TAN Regitration in India
What is TAN?
Under Section 203A of the Income Tax Act of 1961, every organization must quote their Tax Deduction and Collection Account Number (TAN) in all TDS-related communications. Issued by the Income Tax Department, the TAN is a 10-digit alphanumeric number allocated to individuals or entities enrolled under Tax Deduction at Source (TDS) and Tax Collection at Source (TCS).
TAN is required for every entity that deducts tax at source and makes deposits to the government. It must be mentioned in all TDS/TCS returns, certificates, and payment challans to ensure compliance.
What is a TAN Registration Number?
A Tax Deduction and Collection Account Number (TAN) is a 10-digit alphanumeric identifier issued by the Income Tax Department to entities or individuals responsible for Tax Deduction at Source (TDS) and Tax Collection at Source (TCS). The TAN is necessary for proper record-keeping and legal compliance regarding TDS/TCS transactions.
TAN Number: Definition and Structure
The TAN follows a specific structure:
- First Four Characters (Alphabetic): The first three characters represent the jurisdiction in which the TAN is issued, while the fourth character represents the first letter of the applicant's name or entity.
- Middle Five Characters (Numeric): These characters are a unique set of numbers generated by the system.
- Final Character (Alphabetic): This is a system-generated letter to complete the TAN.
Features of TAN Registration:
- Lifetime Validity: TAN is valid for a lifetime; no renewal required.
- Mandatory for TDS Payments: TAN is required for processing TDS payments at banks.
- Applies to Sole Proprietors: Sole proprietors must obtain TAN if they deduct TDS.
- Unique Identifier: TAN is a 10-character alphanumeric code issued by the Income Tax Department.
Who Should Obtain a TAN?
TAN is mandatory for entities involved in the deduction or collection of tax at source. This includes:
- Tax Deducting Entities: Individuals or organizations deducting tax at source (e.g., salary payments, rent payments, contractor payments exceeding Rs. 1,80,000 annually).
- Non-Profit Organizations: Those making payments exceeding the threshold limit as prescribed by law.
- Business Branches: Branches of companies that make TDS/TCS payments exceeding the set threshold.
- Salaried Individuals: Salaried individuals are not required to obtain a TAN, as they do not deduct tax at source.
- Lifetime Validity: The TAN remains valid throughout your life once issued.
- TDS Documentation: TAN ensures all TDS-related transactions are properly documented.
- TDS Returns & Certificates: TDS certificates are issued by entities holding TAN, helping taxpayers track their tax payments.
- Tax Compliance: Taxpayers can use their TDS certificates as evidence of tax payments in case of disputes.
- Required for TDS Payments: TAN must be quoted when making TDS payments, especially while filing challans and submitting returns.
- Aadhaar or other address proof.
- Applicant's name, address, and contact details.
- LLP or firm incorporation certificate (if applicable).
- For online payment, use a credit card, debit card, or net banking.
- For offline payment, provide a DD or challan with the NSDL-TIN reference number.
- All TDS transactions with the bank must contain the correct TAN.
- All TDS/TCS-related forms must correctly mention the TAN.
- Individuals or HUFs (Hindu Undivided Families) who are salaried are not required to obtain a TAN.
- Quoting a fraudulent TAN attracts a penalty of ₹10,000 under Section 272BB(1).
- If you need to modify or update your TAN information, visit the NSDL official website.
You can apply for TAN through online or offline methods. The online process is quicker and more convenient, while the offline process is suitable for those who prefer paper-based applications.
Offline Registration:
- Submit Form 49B to any Tax Information Network Facilitation Center (TIN-FC).
- Corporates that are not incorporated under the Companies Act of 2013 can file Form INC-32 to request TAN allocation.
Online Registration:
- Visit the NSDL-TIN website.
- Navigate to Service > TAN > Apply online > New TAN.
- Complete the required fields and submit your application.
- Pay the registration fee and you’ll receive an acknowledgment.
- For offline payment, submit a Demand Draft (DD) or challan along with your signed acknowledgment receipt to NSDL-TIN.
- After successful e-payment, save and print the acknowledgment and submit it as per the instructions on the website.
Document Submission:
Once you complete the application process, submit the signed acknowledgment receipt along with the required DD or challan to the NSDL address. Ensure the envelope is labeled "Application for TAN" and includes the acknowledgment number at the top.
Track TAN Registration Status:
To check the status of your TAN application:
- Visit the TIN website and use the "Track Status" option.
- Provide the acknowledgment number, name, and date of birth to view the status.
- Alternatively, call the TIN Call Center at 020 - 2721 8080 or send an SMS with the keyword NSDLTAN to 57575 to track the status.
How to Know Your TAN:
- Visit the e-filing page of the Income Tax Department.
- Choose the "Know Your TAN" option.
- Enter your details (name, TAN, or category of deductor).
- Receive an OTP on your registered mobile number to validate and retrieve your TAN information.
Importance of Securing a TAN Number:
As mandated by Section 203A of the Income Tax Act, 1961, individuals or entities responsible for deducting or collecting tax at source must obtain a TAN. This ensures legal compliance with tax regulations and the accurate collection and deduction of taxes.
The TAN Number should be quoted in the following documents:
- TDS or TCS statements and returns
- Challans related to TDS/TCS payments
- TDS/TCS certificates
- Various income tax forms and documents
Advantages of Obtaining a TAN in a simple format:
- Legal Compliance: Ensures adherence to tax laws and avoids penalties for non-compliance.
- Efficient Tax Operations: Streamlines the process of deducting and remitting TDS/TCS on time.
- Simplified Monitoring and Reconciliation: Makes it easier to track, monitor, and reconcile your tax deductions and payments.
TAN Structure:
The TAN is a 10-digit alphanumeric code with the following structure:
- The first four characters are alphabetic
- The next five digits are numeric
- The last character is alphabetic
The first three alphabets represent authority codes, and the fourth alphabet represents the entity type, whether it's an individual, business, or another organization.
The TAN registration process is evolving with the latest government updates. The Ministry of Corporate Affairs (MCA) and the CBDT have issued directives that simplify the filing process, removing the need for separate TAN and PAN filing.
At Filingin, we recommend working with our legal experts to navigate the registration process smoothly and without delay. Avoid complications from incorrect filings and let our team handle all aspects of your TAN application with ease.
Don’t wait for penalties—apply for your TAN today with Filingin!
Frequently Asked Questions in India
What is TAN?
TAN (Tax Deduction and Collection Account Number) is a unique 10-digit alphanumeric identifier issued by the Income Tax Department for entities responsible for deducting or collecting tax at source.
Who needs to obtain a TAN?
Any individual or entity responsible for deducting or collecting tax at source (TDS/TCS) must obtain a TAN. This includes employers, businesses, and non-profits.
Is TAN required for salaried individuals?
No, salaried individuals are not required to obtain a TAN unless they are responsible for deducting TDS from others.
Can TAN be obtained online?
Yes, TAN can be registered online through the NSDL website by filling out Form 49B.
How long is a TAN valid for?
A TAN is valid for a lifetime and does not require renewal.
What documents are required for TAN registration?
Basic details such as PAN, address proof, and other relevant documents are required to apply for TAN.
What happens if I don’t mention my TAN?
Failing to mention your TAN in TDS-related documents can result in penalties or delays in processing tax payments.
Can I update my TAN details?
Yes, if you need to correct any information related to your TAN, you can update it through the NSDL website.
Is TAN applicable to sole proprietors?
Yes, even sole proprietors who deduct TDS need to obtain a TAN.
How can I track my TAN application status?
You can track the status of your TAN application using the acknowledgment number on the NSDL website or by contacting the TIN call center.
