TAN or Tax Deduction & Collection Account Number (TAN) is a unique 10-digit number with an alphanumeric combination, allotted by the Income Tax Department. A TAN starts with the alphabets followed by the numerical and then ends with an alphabet. The first three letters denote the city and state of issuance, fourth letter is the first letter of tax deductor. This is followed by five numbers and the last letter makes the number unique which is different for everybody.
As per the section 203A of the Income Tax Act 1961, any person liable to TDS (Tax Deducted at Source) and TCS (Tax Collection at Source) needs to quote the TAN in returns, challans, and any and all kinds of tax transactions and correspondence with National Securities Depository Ltd (NSDL).
The person deducting the tax at source is required to deposit the tax deducted to the credit of Central Government – quoting the TAN number. On deducting tax at source, the entity registered for TAN will issue a TDS Certificate as proof of collection of tax.
To obtain TAN, application must be made for allotment of TAN in Form 49B along with the required supporting documents. Based on the application, the TAN will be allotted to the entity and the entity must quote the TAN in all TDS/TCS returns, TDS/TCS payment challans and all TDS/TCS Certificates.
To obtain TAN, application must be made for allotment of TAN in Form No. 49B on website of NSDL. TAN number can be applied for online as well as offline. A payment is required to be made for application of TAN No.
Once a TAN is issued, it is valid for lifetime. However, TDS Filings must be made quarterly on the 15th day of July, October, January and May. Non-filing of TDS filings within the due date will attract a penalty.
