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TAN Number: Handbook for Taxpayers

TAN number

TAN Number: An Extensive Manual for Taxpayers

In India, those who are accountable for Gathering tax at the point of sale (TCS) or withholding tax at the source (TDS. individual receives a unique 10-character code called the TAN from the Central Government’s Income Tax Department. The TAN number is crucial for tax compliance under Section 203A of the Income Tax Act of 1961, and must be included on all relevant documents. The submission of returns is an essential element of India’s tax regulatory system.

What does TAN Number mean and what is its structure?

TAN stands for Tax Deduction and Collection Account Number. This is a unique ten-digit alphanumeric code with a specific format.

  •   First Four Digits (Letters): The first three letters in the TAN indicate the location where it was issued, while the fourth letter represents the first initial of the person or organization applying for the TAN.
  • The following five numbers (numerical):The system generates unique numerical digits in the middle, consisting of five numbers.
  •   Last Digit (Letter): The system generates a distinct letter as the final digit.

This organized combination of letters and numbers assists in recognizing where the TAN comes from and who issued it, making it a distinct identifier for tax-related reasons.

 Who Needs to Get TAN?

As stated earlier, if you are in charge of deducting taxes from specific payments, you need to acquire a TAN (Tax Deduction and Collection Account Number).

It is crucial to acquire a TAN number.

According to Section 203A of the Income-tax Act, 1961, it is necessary for anyone who is responsible for deducting or collecting tax to obtain a TAN (Tax Deduction and Collection Account Number). Additionally, Section 203A requires the addition of TAN Number in various documents.

The following documents must include a reference to TAN.

  • Statements or returns related to Tax Collected at Source (TCS) or Tax Deducted at Source (TDS).
  • Tickets for payments of TDS or TCS.
  • Submitting TCS or TDS certificates.
  • Gathering or submitting a variety of IT-related forms and documents.

Penalty for not complying with TAN regulations.

Failing to obtain a TAN or omitting it from necessary documents can result in a fine of Rs. 10,000, as detailed in Section 272BB.

TAN Application Process

There are two choices available when applying for a TAN (Tax Deduction and Collection Account Number).

 Offline Method

To obtain a TAN through the offline process, the individual must fill out Form 49B (the TAN allotment application form) and send it, along with the required fees, to any TIN-Facilitation Center (TIN-FC) operated by Protean.

Another option is for the applicant to visit the NSDL website, download the TAN application form, fill it out, and then submit the completed form along with the necessary fees to the TIN-FC. For reference, the Form 49B is provided here.

When the application is submitted in person at a TIN-FC, supporting documents do not need to be provided to the Income Tax department.

 Online Method

Candidates have the option to submit their TAN application electronically through the NSDL website. It is important for them to closely adhere to the provided guidelines, complete the online form accurately, and electronically submit it.

  • After the submission is completed successfully, a unique acknowledgment number will be provided. It is important to print and send this acknowledgment number to the NSDL office in Pune.
  • The fees for the application can be paid either online, by demand draft, or by cheque.
  • After receiving the TAN application, the IT department will examine the information provided and then send the TAN to NSDL for the applicants.
  • The NSDL will either mail the TAN details to the address specified on Form 49B or send it through email.

 TAN Application Fees

The fee for obtaining a TAN (Tax Deduction and Collection Account Number) is Rs. 65, which includes both processing fees and the Goods and Service Tax (GST).

 TAN Number Search

Taxpayers are able to obtain a tax collector or deductor’s TAN (Tax Deduction and Collection Account Number) via the e-filing portal. Here is a guide on how to accomplish this:

Go to the main page of the e-filing portal and locate the section labeled as ‘Quick Links’.

  • Select the ‘Know PAN Details’ option located in this section.
  • Choose the type of person or organization who is deducting the tax and give their name, location, and your contact number.
  • To move forward, simply press the ‘Continue’ button.
  • Next, you need to confirm your identity by using a One-Time Password (OTP).
  • Once the validation is complete, a list of records that correspond to the deductor’s name will be shown.

You can view the basic information and Assessing Officer details of the deductor by selecting their name from the list.

This search function allows taxpayers to easily access important information about tax deductions and collections.

Updating your TAN information online.

If you need to update your Tax Deduction and Collection Account Number details, you can easily do it online by following these steps:

  •   Step I: Check out the website at https://tin.tin.nsdl.com/tan/index.html.Choose the “Online Application for Amending or Correcting TAN Data for Allotted TAN” form.
  •   Step II: Complete the TAN Change Request form online. Submit the form.
    • Ensure that all required fields (indicated with *) on the form are filled out before submitting.
    • Choose the correct box on the left side of the relevant field to indicate where a correction is required.
  •   Step III: If there are any validation errors at the format level in the data you have submitted, you will be shown an error message on the screen.
  •   Step IV: Identify and fix any mistake(s) in the form. Resubmit the form.
  •   Step V: If there are no errors at the form level, the confirmation screen will show the information that you have inputted.
  •   Step VI: If you need to make changes to the information displayed on the confirmation screen, you can select the edit option.
  •   Step VII: Choose the confirm option if the information shown is accurate. .
  •   Step VIII: Once the fees have been paid successfully, a confirmation slip will be created (for payments made by methods other than demand draft or cheque).
  •   Step IX: Please keep the acknowledgment slip and make a printed copy as well.Please submit it, along with the necessary paperwork, to Protean (formerly known as NSDL eGov) at the address provided below:
    • Protean eGov Technologies Limited specializes in a wide range of e-government technologies.
    • Sapphire Chambers is located on the fourth floor.
    •  Baner Road, Baner,
    •  Pune – 411015

Note: 

A request for changing the Tax Deduction and Collection Account Number (TAN) can only be made if the category of the applicant is incorrect in the Income Tax Department (ITD) TAN database. For instance, if ABC Ltd. is listed as a “Firm” in the ITD TAN database, the category can be updated to “Company,” which is the correct category.

If you want to cancel a TAN, the TAN that needs to be canceled should not be the same as the one currently shown at the top of the form.

Cases where a TAN number is not mandatory:

Nevertheless, there are certain circumstances in which you can opt to utilize your Permanent Account Number (PAN) rather than having to obtain a Tax Deduction and Collection Account Number (TAN).

  •   Section 194IA: If you are selling certain properties, excluding agricultural land, you must withhold tax at the source.
  •   Section 194-IB: Individuals and HUFs who paid rent of over Rs. 50,000 per month should withhold 5% tax. This regulation is applicable to those who did not undergo a tax audit under Section 44AB in the previous fiscal year.
  •   Section 194M: If you are making payments for services such as contracts, commissions, or professional fees totaling over Rs. 50 lakhs in a financial year, you are required to deduct a 5% tax at source. This rule also applies to individuals and Hindu Undivided Families not covered under specific sections like 194C, 194H, and 194J.

In these specific situations, it is permissible to use your PAN instead of applying for a separate TAN.

TAN and PAN have differences between them.

Below is a table comparing TAN (Tax Deduction and Collection Account Number) with PAN (Permanent Account Number).

  Aspect   TAN, short for Tax Deduction and Collection Account Number, is a unique number used for deduction and collection of taxes.  The Permanent Account Number (PAN) is a unique identification number assigned to individuals and entities in India.
 Issuer The tax department in India which collects income tax. The Indian Income Tax Department
 Purpose Assists in deducting and collecting taxes. A comprehensive financial ID
 Applicability Necessary for the purpose of tax deduction and gathering.  Mandatory for all taxpayers
 Governed by Section 203A of the Income Tax Act. Section 139 of the Income Tax Act (1961) deals with the process of filing income tax returns.
 Penalty for Non-compliance Not providing a TAN can lead to a fine. Not providing PAN may lead to a fine.
 Application Forms Form 49B can be submitted either offline or online through NSDL. Form 49A is for Indian citizens while Form 49AA is for foreigners.
 Supporting Documents Usually, a signed acknowledgment is not necessary for applications submitted offline. However, it is typically required for applications submitted online. Valid identification with a photo, proof of age (date of birth), and photos may be necessary.
 Change Requests You can make requests for changes or corrections online. Modifications can be requested by Indian citizens through Form 49A or by foreigners through Form 49AA.
 Online Services Applications and change requests are open for submission. Limited online services are available for PAN.
 Structure A code consisting of 10 characters, comprising both numbers and letters, following a set format. A unique alphanumeric code made up of 10 characters with a distinct structure.
 Main Use Mainly utilized for tax deduction and collection. Used in a range of financial transactions and government-related tasks.

Make the process of applying for a TAN easier by using Meerad.

Meerad is able to help individuals and companies in achieving their goals. Meerad makes the process of applying for TAN (Tax Deduction and Collection Account Number) simple and efficient due to our knowledge of tax and compliance issues. Our experienced team can assist you in completing all necessary steps accurately and on time to ensure the required documents and forms are submitted promptly.

Selecting Meerad for your TAN application will help simplify the process, minimize the risk of errors, and assure you that your tax needs are being handled by competent professionals.

Are you prepared to easily obtain your TAN? Get in touch with Meerad now and start the process towards smooth tax compliance.



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