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TAN (Tax Deduction Account Number)

Tax Deduction and Collection Account Number or TAN is a 10 digit alpha-numeric number which is compulsory to be obtained by all persons who are accountable for Tax Deduction at Source (TDS) and Tax Collection at Source (TCS) on behalf of the Income Tax Department. The persons who deduct or collect tax at source on behalf of the Income Tax Department are required to apply for and obtain TAN. If a person responsible for TDS/TCS fails to apply for TAN or does not comply with the provisions of the Act, he may have to pay a penalty of Rs. 10,000/-.

The Income Tax Act makes it mandatory for all persons responsible for TDS/TCS to quote TAN in all the TDS/TCS returns, all TDS/TCS payment challans and all TDS/TCS certificates to be issued. TDS/TCS returns, whether filed in paper or electronic format, will not be received by the authority if TAN is not quoted. Also, banks will not accept any TDS/TCS challans on which TAN is not quoted.

A person should have only one TAN. It is illegal for a person to have multiple TANs. If a person has received a duplicate TAN by mistake or otherwise, the same must be surrendered for cancellation. No separate TAN is required for TDS or TCS. The same TAN needs to be mentioned in all returns and challans, whether related to TDS or TCS. However, in case of companies or banks, if the company/bank has more than one branch, then each branch or the person responsible for that branch must separately apply for TAN.

Application for TAN

In order to apply for a TAN or to get the details on the existing TAN changed or corrected, you are required to make an application in the requisite form. You cannot apply for a TAN on plain paper. Application for new TAN is to be made in Form 49B and submitted to any of the Tax Information Network Facilitation Centres (TIN-FCs) managed by the National Securities Depository Ltd (NSDL). TIN-FC addresses are available at www.incometaxindia.gov.in or http://tin.nsdl.com. The application can also be made online through http://tin.nsdl.com. Generally, no documents are needed to be submitted with TAN application, but in case of online application, the acknowledgement generated must be forwarded to the NSDL. The processing fee for TAN is Rs. 50/- + service tax, as applicable. This fee needs to be paid at the time of submitting the Form.

The applications are digitized by NSDL and are then forwarded to the Income Tax Department. The Income Tax Department will process the TAN application and will issue the TAN that will be intimated online to NSDL. On the basis of receipt of the TAN from Income Tax Department, the NSDL will issue TAN letters to the applicant. The new TAN letter would come to the person at the address indicated in the Form or would be given against the acknowledgement in case of online application. NSDL will intimate the TAN to the person and he would be required to mention the TAN on all future correspondence relating to TDS/TCS.