The Tax Deduction/Collection Account Number (TAN) is a 10-digit alphanumeric identity number issued to persons responsible for collecting or deducting tax at the source.
In India, all companies and individuals need to have a TAN number to run their day-to-day operations hassle-free and avoid penalties.
We’ll walk you through everything you need to know about TAN in this blog.
What is TAN?
The Tax Deduction/Collection Account Number also known as TAN number starts with 4 alphabets and 5 numerals, followed by 1 alphabet. It is issued by the Income Tax Department.
The TAN number must be quoted in TDS and TCS returns, payments, challans, and certificates; the penalty for not doing so is a fine of Rs 10,000!
Importance of TAN for businesses
TAN number serves as a crucial identification number for businesses for filing tax returns.
All businesses, big or small, are mandated by the Government of India to register for a TAN number.
Why do they need a TAN number?
All businesses are required by law to deduct or collect tax from every sale of certain products like liquor and luxury cars.
This tax is called TDS or TCS. Businesses then have to declare how much tax has been collected or deducted.
TAN number is used to identify each business’s TDS/TCS declarations, returns, and deposits.
[Also Read: TDS Rate Chart: FY 2022-23]
How to apply for TAN
The Tax Information Network (TIN) allots TAN to businesses on behalf of the Income Tax Department. Businesses can apply for their TAN number online or offline.
Online TAN Application
You can follow the following steps if applying for TAN online:
- Visit the NSDL-TIN website (https://tin.tin.nsdl.com/tan/index.html)
- Select ‘Online application for TAN (Form 49B)’ on the website
- In the ‘Apply for new TAN’ option, select the category of deductors and click on ‘Select’
- Carefully fill Form 49 B, avoiding any errors, and click on ‘Submit’.
- Now, pay the fees online, or make a DD, cheque, payable at par in Mumbai, favoring NSDL-TIN or by credit/ debit card
- You can track the status of your application with a 14-digit acknowledgment number
- Next, print this document, sign it, and then send it to the NSDL office at:
NSDL e-Governance Infrastructure Limited,
5th floor, Mantri Sterling,
Plot No. 341, Survey No. 997/8,
Near Deep Bungalow Chowk,
Pune – 411016
Offline TAN Application
You can also apply for TAN offline by following these steps:
- Visit the nearest TIN Facilitation Centre and avail Form 98. You can also download this from the Income Tax website for free
- If your company is not registered under the Companies Act, a Form INC-7 has to be filled out
- Fill the form and submit it at the TIN counter along with a processing fee of Rs 63 via demand draft, cheque, or cash.
- You can track the status of your TAN application with the NSDL by calling the TAN call center at 020-27218080 or sending an SMS ‘NSDLTAN’ to 57575.
Penalties for TAN defaulters
If a company fails to quote Tax Deduction/Collection Account Number on documents where TAN is mandatory, it will be levied a penalty of Rs 10,000.
If a company provides incorrect TAN, it will be penalized Rs 10,000 under Section 272BB of the Income Tax Act.
This is why it is important to keep track of your TAN number and ensure that you have declared it correctly at every step of the way.
Of course, being human is to err, and we are bound to make mistakes!
Thankfully, RazorpayX’s Tax Payment solution is built to automate all these processes, saving you time, effort and money!
If you pay Advance Tax, GST, and TDS/TCS, you know the pain of having to deal with three different, slow, and tedious government portals. With RazorpayX:
- Get one smooth, sleek dashboard for everything
- CA makes your tax payments? Now collaborate seamlessly with custom access features
- Never lose a challan again; all challans generated and stored in one single place
- And so much more! RazorpayX is an all-in-one banking suite, optimized for Indian businesses.
Frequently Asked Questions (FAQs)
How can I get a TAN number for my business?
The Income Tax Department will provide TAN to applicants who can choose to apply via offline or online modes. Applicants can either apply for TAN on the NSDL-TIN website or visit their nearest TIN Facilitation Centre.
Will I be charged to get a TAN number?
Yes, processing fees of Rs 63 will have to be paid by the applicant to get a TAN offline, and Rs 55 + service charges for online mode.
Do I need different TAN numbers for TDS and TCS?
No, a single TAN is used for both TDS and TCS purposes.
Is it okay if my company has a PAN but not a TAN?
No, businesses need a TAN number regardless of a PAN number. PAN cannot be used by deductors or collectors for TDS and TCS purposes.
What documents should I submit with Form 98 when applying for a TAN?
You do not need to submit any extra documents if you are applying offline. If you are applying online, you will have to print and sign the acknowledgement slip after filling the form and send it to the NSDL office.
How can I check the status of my TAN application?
The NSDL-TIN website has a ‘track status’ section where you can check the status of your application 3 days after application. You can also send an SMS NSDLTAN to 57575 for the same.
My TAN application has been rejected. What should I do?
It is likely that you made a mistake filling the form or during payment. Go to your nearest TIN Facilitation Centre and take the help of the officials to ensure you are making no mistakes.
Do I need a separate TAN for different branches of my company?
Yes, you would need to apply for different TAN for different branches of your company.
How will I receive my TAN number?
You will get a TAN allotment number on the address mentioned by you in Form 98.