TAN stands for “Tax Deduction Account Number” which is a unique 10 digit alpha-numeric number which is allotted to all the entities who are obliged to deduct or collect tax at source under Income Tax Act. An application for TAN registration can be made by any entity in Form-49B at TIN Facilitation Centres or an application can be made online. TAN is compulsory not only for deduction/collection of tax at source but it is also required for filing quarterly TDS/TCS returns.
The Government has specified certain transactions where tax has to be compulsorily deducted or collected by the specified assesses. Every person deducting tax deducted at source must issue a certificate to the effect that the tax has been deducted. Such certificate must quote TAN of the deductor.
BENEFITS OF TAN NUMBER
• While filing TDS return using TAN, the complete address and PIN code of the deductee gets auto-populated as mentioned in Income Tax Department. This ensures transparency in taxation.
• While filing TDS return using TAN, Status of Booking also gets captured. This helps the deductor to track whether or not his return has matched with TDS statement filed by him.
• Apart from filing TDS returns, TAN can also be used for generating payment challans and TDS/TCS certificates.
• Different branches of a company can separately make TAN application online for a separate TAN for that branch or division.
✅ Mobile no. and email id of proprietor/signing partner/signing director
✅ Address proof of registered office
✅ PAN card of the entity/proprietor
✅ Passport Size Photo
Who Should Buy?
► Every individual or entity that requires to deduct tax at source while making certain payments like salary, payments to contractor or payment of rent exceeding Rs.1,80,000 per year etc.
► Non profit organizations making specific payments above threshold limit
► Branches of businesses making specified payments above the threshold limits
Individuals who are salaried are not required to obtain TAN or deduct tax at source.
TAN Registration FAQs
❓ Who are mandatorily required to have TAN?
☛ Persons who are supposed to deduct or collect tax at source, are required to have a TAN.
❓ Which form is to be submitted for getting a TAN?
☛ Form-49B has been prescribed by the Income Tax Department for application of TAN.
❓ If entity not required mandatory tax audit, Is it compulsory to apply for TAN & deduct TDS?
☛ Yes, You need to deduct TDS on salary, vendor payments and other payments as per the provision of TDS irrespective of your business entity required Tax audit under section 44AB or not.
❓ How much time does it take in issue of a new TAN?
☛ TAN card gets delivered usually within 7-15 business days. The decision however solely depends upon the Issuing Authority of Govt of India. ClearTax shall provide you with the tracking details once application is submitted.
❓ What is the validity of TAN?
☛ A TAN is issued with lifetime validity and doesn’t need to be renewed. However, if there are changes in the details submitted during the application for TAN registration, the same have to be communicated to the Tax Department.