Tax deduction and collection account Number or TAN is a ten digit alphanumeric number that must necessarily be obtained by all entities responsible for deducting or collecting tax on behalf of the government. The task of issuance of TAN number is administered by the Income Tax department.
Why is it necessary to obtain TAN?
Section 203A of the Income Tax Act requires all entities deducting or collecting tax at source to apply for and obtain TAN. Further, the section also mandates quoting of TAN in TDS/TCS return including e-TDS/e-TCS return, TDS/TCS certificates and TDS/TCS payment challans.
The tax authorities would not receive the returns until TAN is quoted on TDS or TCS returns. Likewise, banks would not accept TDS or TCS payment challans in case TAN is not specified on them.
Who all can apply for TAN?
TAN can be applied for by several entities including individual (Sole Proprietorship) / branch of individual business; Association of Persons (AOPs)/ Body of Individuals (BOIs)/Artificial Juridical Person/ trust; firm/branch of firm; company or branch of a company; HUFs, statutory/autonomous bodies; and state or central government or local authority.
What is the consequence in case the applicable entity does not apply for TAN?
Failure to apply for TAN or quote the same in required documents results in the levy of penalty amounting to Rs. 10,000/-.
How to apply for TAN?
The above set of entities seeking to obtain TAN can fill and submit Form 49B either online at tin nsdl website or at any of the TIN-facilitiation centres (TIN FC) administered by NSDL. To find out the address of TIN FC in your city you can visit http://tin.nsdl.com or www.incometaxindia.gov.in.
While no documents are required to be furnished in case of offline application for TAN deposited at TIN FC, online application requires the submission of acknowledgment that is generated after filling up form 49 B to NSDL. After processing of the TAN application, the department would furnish TAN number of the applicant through correspondence at the provided address.