What Is Tax Deduction & Collection Account Number (TAN): How To Check If It's Old Or Not?

TAN or Tax Deduction and Collection Account Number is a unique ten-digit alpha-numeric number required to be obtained by all persons who are responsible for deducting or collecting tax.

Finding New & Old TAN

Under Section 203A of the Income Tax Act, 1961, it is mandatory to quote the Tax Deduction Account Number (TAN) allotted by the Income Tax Department (ITD) on all TDS statements. To facilitate deductors finding their new TAN, the income tax department has introduced a search facility on the official website (www.incometaxindia.gov.in). Through this facility, deductors can search on the name and old TAN to find the new TAN. Deductors are advised to find a new TAN from this site before it is incorporated in their e-TDS statement to avoid any inconvenience at the time of furnishing e-TDS statements.

Importance of TAN in taxation

Every person liable to deduct tax at source or collect tax at source is required to obtain TAN. However, a person required to deduct tax under section 194IA or section 194-IB or section 194M can use PAN in place of TAN as such person is not required to obtain TAN.

Section 194IA provides for deduction of tax at source from payment on transfer of certain immovable property other than agricultural land. Section 194-IB provides for deduction of tax at source at the rate of 5% from payment of rent. The tax shall be deducted if the rent paid or payable exceeds Rs. 50,000 per month or part of the month. This provision applies to individual and HUF, who is not liable to tax audit under Section 44AB in the immediately preceding financial year. Section 194M provides for deduction of tax at source at the rate of 5% on the sum paid or credited, to a resident, on account of contractual work, commission (not being insurance commission referred to in section 194D), brokerage, or professional fees, by an individual or a HUF, if the aggregate of such sum exceeds Rs. 50 lakhs in a financial year. This provision applies to individuals and HUF, who are not covered under section 194C, section 194H, and section 194J.

When is it mandatory to quote TAN?

As per section 203A of the Income-tax Act, 1961, every person who deducts or collects tax at the source has to apply for the allotment of TAN. Section 203A also makes it mandatory to quote TAN in TDS/TCS return (including any e-TDS/TCS return), any TDS/TCS payment challan, TDS/TCS certificates, and other documents as may be prescribed. As per section 272BB, failure to apply for TAN or not quoting the TAN in the specified documents attracts a penalty of Rs. 10,000.

Checking TAN allotment

TAN is allotted by the Income Tax Department based on the application submitted to TIN Facilitation Centres (TIN-FC) managed by NSDL. NSDL will intimate the TAN which will be required to be mentioned in all future correspondence relating to TDS/TCS. TIN Facilitation Centres will help the deductors in ascertaining their correct TAN from the database. TAN can also be verified from the information on the website of the Income Tax Department at www.incometaxindia.gov.in. Using the "Know Your TAN" facility at www.incometaxindia.gov.in or https://www.incometax.gov.in/iec/foportal the deductor can know the TAN.