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An Overview of TAN (Tax Deduction and Collection Account Number)

TAN stands for the Tax Deduction and Collection Account Number. It is essentially a 10-digit code comprising an alphanumeric number. The TAN is mandatory for all taxpayers who are liable to collect or deduct the tax under section 203A of the IT Act 1961. The Income Tax Department grants TAN to the applicable taxpayers u/s 203A of the Income Tax Act, 1961. Every TDS return must reflect TAN without fail.

What is the significance of TAN?

TAN is a mandate for all individuals who wants to ensure hassle-free filing of TCS or TDS returns with the TIN facilitation centers. The absence of TAN can compel the banks to reject the TDS/TCS challans. The non-availability of PAN on TDS/TCS returns, TDS/TCS payment challans, and TDS/TCS certificates can attract a fine of Rs 10,000.

As per Section 203A, the following necessary papers should reflect TAN without fail:

  • TDS statement i.e Return
  • TCS statement i.e Return
  • TDS/TCS Certificates
  • Statement of financial transactions
  • Challans for payment of TDS/TCS

Who must secure the TAN?

All those who are involved with the deduction or collection of tax at source on behalf of the IT department need to apply and secure TAN without fail.

Types of Applications Concerning TAN

TAN applications are basically of two types as shown below:

  • Application concerning the issuance of new TAN
  • Application for altering or correcting the TAN details

How taxpayer can apply for a TAN?

The application for the allotment of a new PAN can be applied either via online mode or offline method. The latter requires the applicant to visit the TIN facilitation centers operated by Protean eGov Technologies Limited.

If you wish to apply online, just go through the following steps:

  • Head to the NSDL official portal.
  • Under the Section section on the home page, select “TAN”.
  • Tap on the option namely “Apply online” followed by “New TAN”.
  • On the new window, use the list to select an apt category of deductor and then tap on the option called- Select.
  • The portal shall open the e-application namely- Form 49B
  • Fill in the e-application and then hit the Submit button.
  • Once you complete the form, the following window shall prompt the following details
  1. A 14-digit acknowledgment number
  2. Applicant’s status
  3. Applicant’s name
  4. Contact details
  5. Payment details
  6. Space of signature
  • Save the acknowledgment receipt on the system and take the print of the same.
  • Attested the hard copy of the acknowledgment receipt to other dossiers and send it as a bundle in an envelope to the Protean eGov Technologies Limited

How to secure TAN via Digital Signature Certificate?

The following steps will help you secure TAN via Digital Signature Certificate

  1. Head to the NSDL portal and tap on the “Apply Online” option listed in  the TAN module.
  2. Choose the DSC-oriented TAN application option followed by the applicant category.
  3. Duly filed the e-form without any error.
  4. Insert the DSC of the concerned signatory and enclose the digital signature in the e-form.
  5. Head to the payment section to submit the fee
  6. Secure the acknowledgment receipt reflecting the 14-digit unique tracking code

What about the offline method of securing TAN?

The offline method doesn’t entail all these steps. It requires applicants to visit the respective TIN facilitation center and submit the application along with the required paperwork. Here’s how you can apply for TAN via offline mode.

  1. Visit the NDSL portal and download the e-form called Form 49B
  2. Fill out the form in the English language. Use uppercase to fill out the form.
  3. Enclose the signature in the form wherever required
  4. Submit the form to the nearest TIN facilitation center. Note: The form enclosing the thump impression needs to be attested by the Notary Public or Magistrate, under official stamp and seal.
  5. Pay the application fee at the counter of TIN-FC.

TAN application Fees and mode of submission

The processing fee is the same for both types of applications i.e. change or correction in TAN details and issuance of new TAN. The fee has been capped at Rs.65.

The following modes are available to the applicant when it comes to fee submission:

  • Demand draft
  • Credit card/Debit card
  • Cheque
  • Cash (if the offline application submits at TIN FC)
  • Net banking

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How to perform the status check concerning the TAN Application?

Upon the successful submission of the TAN application, an applicant can start tracking its progress after three days. The applicant can make use of a 14-digit acknowledgment number to view the application status on the NSDL portal. Here’s how you can do the same.

  1. Head to the NSDL web portal.
  2. Under the Service option, choose “TAN’.
  3. Explore the option namely - “Know Status of Your Application”
  4. Next, choose the option called 'Application Type'
  5. Enter your 14-digit acknowledgment number in the given field.'
  6. Next, complete the CAPTCHA verification
  7. Tap on the 'Submit' button.

Do TAN and PAN serve the same purpose?

PAN and TAN serve different purposes. Whereas PAN (Permanent Account Number) refers to a 14-digit number assigned to a taxpayer, TAN (Tax Deduction and Collection Account Number) is allotted to individuals obligated to deduct or collect taxes. PAN helps the authority keep a tab on taxpayers’ finances and tax-related transactions.

PAN Vs. TAN Vs. TIN: Know the Differences

Parameters

TAN

PAN

TIN

Issuing Authority

IT Department

IT Department

Commercial Tax Department of Respective State

Code

10-digit alphanumeric code

10-digit alphanumeric code

11 digit

Purpose

Use for collection and deduction of tax

 

 

Use for fiscal transactions

 

Act as an identity proof

Keep a tab on VAT-based activities

Who needs it?

People who collect and deduct u/s 203A

Taxpayers/ Non-Taxpayers

Foreign nationals and entities

 

Dealers, exporters, and traders

Governing legislation

Section 203A of the Income Tax Act of 1961

Section 139A of the Income Tax Act of 1961

State-wise law

Penalties

Rs 10,000

Rs 10,000

Penalties differ state-wise

Forms to fill

Form 49B

Form 49A for Indian Citizens

Forms vary state-wise

Let Corpbiz experts help you get TAN without any delay

TAN is mandatory for all who deduct or collect taxes at source. Its non-availability can compel you to encounter severe penalties, which are unskippable. The Income Tax Department has widespread surveillance that is proficient in identifying those who are not complying with underlying tax laws. So it is advisable to secure your PAN without any further delay. If you are unsure how to do so, let Corpbiz’s experts help you out.

Frequently Asked Questions

The Income Tax Department exercises the exclusive power to grant TAN to eligible taxpayers.

As such no necessary papers are required to apply for TAN in India.

The applicant is required to pay the fee of Rs 65 to apply for TAN in India

If you are relocating within the same then no TAN surrender is mandatory. But, if you are relocating to another cites or state, TAN surrender is a must-have requirement. Upon TAN surrender, you need to reapply for a new TAN.

In such a case, you can visit the IT department portal and fetch the softcopy of your TAN details.

No! PAN and TAN serve different purposes and fall under different legislation.

Such acts are considered an offense under the IT Act and attract a penalty of Rs 10000.

In most cases, Rs 10000 shall be imposed on the defaulters.

It’s because it enables authority seamlessly tracks income streams and applicable taxes

Those who collect or deduct taxes are mandatorily required to secure TAN in India.

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