What is TAN? Meaning, Application Process & TAN vs PAN

Introduction

TAN (Tax Deduction and Collection Account Number) is a unique 10-digit number issued by the Income Tax Department to individuals or entities that are responsible for deducting or collecting tax at source. It is an essential identification number for anyone involved in TDS (Tax Deducted at Source) or TCS (Tax Collected at Source) transactions. Understanding the importance of TAN, how it relates to PAN (Permanent Account Number) and TIN (Taxpayer Identification Number), and the application process can help businesses and individuals comply with Indian tax laws. This guide provides a complete understanding of TAN, its differences from PAN and TIN, and how to apply for it.

What is the TAN Number?

A Tax Deduction and Collection Account Number (TAN) is a unique 10-digit alphanumeric code assigned to individuals or entities who are required to deduct or collect tax on behalf of the Income Tax Department. The primary function of TAN is to ensure that taxes are collected at source and that the correct TDS/TCS returns are filed with the government.

Key points about TAN:

1. Mandatory for TDS/TCS: TAN is mandatory for those who deduct or collect tax at source.
2. Issued by the Income Tax Department: It is issued after submitting an online or offline application.
3. Tax Compliance: Ensures compliance with tax laws by tracking TDS/TCS activities.
4. Permanent: Once issued, the TAN remains permanent throughout the lifecycle of the entity.

Get instant access to markets—Open Demat account

Who Requires a TAN Number?

TAN is required by:

1. Employers: Employers deduct TDS on salary payments and need a TAN to deposit taxes.
2. Business Owners: Individuals or entities who deduct tax at source for payments such as rent, professional fees, interest, etc.
3. Banks: Financial institutions that deduct tax on interest payments and other transactions.
4. Government Bodies: Government agencies that handle TDS for various payments.
5. Contractors and Sub-contractors: Those involved in work contracts and other services subject to TDS.
6. Others in TDS/TCS Role: Anyone involved in tax deductions or collections for any transaction, including lenders, property owners, and insurance companies.

What is a PAN Number?

PAN (Permanent Account Number) is a unique 10-digit alphanumeric identifier issued by the Income Tax Department to individuals, companies, and other entities for tax purposes. It is used to track an individual's or a business's tax-related activities.

Key points about PAN:

1. Identification: PAN helps identify taxpayers and is used for filing returns and paying taxes.
2. Required for Various Transactions: PAN is necessary for activities like opening a bank account, buying property, and investing in the stock market.
3. Non-transferable: The same PAN remains throughout your life, irrespective of changes in address, name, or citizenship.
4. Tax Filing: PAN is required for individuals to file their Income Tax Returns (ITR).

PAN helps the government track financial transactions and prevent tax evasion.

What is TIN Number?

TIN (Taxpayer Identification Number) is used by businesses and entities that are required to collect or pay indirect taxes like VAT (Value Added Tax), sales tax, and service tax. It is a unique number issued by the tax department to help identify businesses for tax purposes.

Key points about TIN:

1. Business Identification: It is used by businesses for tax-related purposes like VAT and service tax filing.
2. Mandatory for Businesses: Businesses with taxable sales or services must apply for TIN.
3. Issued by State Governments: TIN is issued by the respective State Sales Tax Department.
4. Essential for Transactions: It is required for businesses to issue tax invoices and engage in transactions subject to indirect taxes.

Who Requires a TIN Number?

TIN is required by:

1. Businesses: All businesses involved in sales, goods, or services that need to collect or pay indirect taxes like VAT or GST.
2. Traders: Anyone involved in selling goods or providing services subject to sales tax or VAT.
3. Freelancers: Freelancers who provide taxable services and need to register under VAT or GST.
4. Manufacturers and Wholesalers: Those who engage in the sale of goods or wholesale business and are subject to VAT/GST.
5. Exporters/Importers: Exporters and importers also need a TIN to track sales tax and customs duties.

What are the Documents Required for a TIN?

To apply for TIN, the following documents are typically required:

1. Business Proof: Proof of the business name and address (like a lease deed or registration certificate).
2. Identity Proof: Aadhar card, PAN card, or any government-issued ID.
3. Proof of Business Type: Documents like a trade license, a partnership deed, or a company registration document.
4. Bank Account Details: Proof of business bank account with account number and branch details.
5. Photographs: Passport-sized photos of the applicant.

These documents ensure that the TIN application is processed smoothly.

Detailed Comparison Between PAN, TAN, TIN

Here is a simple table to help you easily compare the three different types of tax identification numbers:

Feature

PAN (Permanent Account Number)

TAN (Tax Deduction and Collection Account Number)

TIN / GSTIN (Taxpayer Identification Number)

Full Form

Permanent Account Number

Tax Deduction and Collection Account Number

Taxpayer Identification Number (Now GSTIN)

Issuing Authority

Income Tax Department (Central Government)

Income Tax Department (Central Government)

State Tax Authorities (Now Central/State for GST)

Format

10-Digit Alphanumeric Code

10-Digit Alphanumeric Code

15-Digit Alphanumeric Code (GSTIN)

Primary Purpose

Universal ID for all financial transactions and Income Tax filing.

Mandatory for deducting or collecting tax at source (TDS/TCS).

Mandatory for businesses registered under GST for supply of goods/services.

Who Needs It?

Every taxpayer and anyone doing high-value financial transactions.

Persons/entities who are legally required to deduct or collect tax (Deductors/Collectors).

Businesses crossing the minimum turnover limit for selling goods/services.

Quoting Required On

Income Tax Return, Bank Account Forms, Property Sale/Purchase, etc.

TDS/TCS Returns, Challans for TDS/TCS payment, TDS Certificates.

Sale Invoices, GST Returns, E-way Bills.

Type of Tax

Direct Tax (Income Tax)

Direct Tax (Income Tax – for tracking TDS/TCS)

Indirect Tax (Goods and Services Tax – GST)

What Happens if the TAN is Not Quoted?

Failure to quote TAN while filing TDS returns or making payments can result in:

1. Penalties: The Income Tax Department can impose penalties for non-compliance.
2. Invalid Returns: TDS returns will be considered invalid if TAN is missing, delaying processing.
3. Interest Liabilities: Interest may be charged for non-deduction or late deduction of taxes due to a missing TAN.

Types of TAN Applications

There are mainly two types of applications you can file regarding your TAN number:

1. Application for Allotment of New TAN (Form 49B):

   • This is for people or businesses who are required to deduct or collect tax for the first time and do not have a TAN yet.
   • You use Form 49B for this application.
   • Once you submit this form, the Income Tax Department will issue a new, unique 10-digit TAN number for you.

2. Application for Change or Correction in TAN Data (Change Request):

   • This application is for people or businesses who already have a TAN but need to make a change or a correction in the details linked to it.
   • For example, if the name of your company changes, the address of your business changes, or there is a spelling mistake in your name or address in the tax records, you need to use this application.
   • You apply for this change using a separate form called the "Form for Change/Correction in TAN data".

Both these applications (New TAN and Change/Correction) can be done either online through the official government portal or offline by visiting a facilitation centre.

How to Apply for a TAN?

Online Method (Recommended):

1. Go to the Official Portal: Visit the official website of the government agency responsible for processing TAN/PAN applications (Protean eGov Technologies Limited, formerly NSDL e-Gov).
2. Select Application: On the website, find and click on the option for "Online Application for TAN (Form 49B)" under the TAN section.
3. Choose Applicant Category: A list of different types of applicants (like Company, Firm, Individual/HUF) will appear. Select the one that describes you or your business correctly.
4. Fill Form 49B: The electronic form (Form 49B) will open. Fill in all the mandatory details correctly. This includes your name, address, contact details, and the category of tax deductor/collector.
5. Payment: Pay the application fee (around ₹77.00, including GST, for the Financial Year 2025-26). You can pay using a credit card, debit card, or net banking.
6. Acknowledgement: After successful payment, a confirmation page called the Acknowledgement Slip will be generated. It will have a 14-digit Acknowledgement Number.
7. Submit Documents: You must print this acknowledgement slip, sign it (or have the authorized person sign it), and send it to the Protean eGov Technologies Limited office address (mentioned on the slip) within 15 days of the online application.

The TAN will be allotted and sent to your address once the processing is complete.

Offline Method to Apply for and Know Your TAN

If you cannot apply online, you can use the offline method. You can also check if a TAN is already allotted in the name of a business or person.

Offline Application:

1. Obtain Form 49B: You need to get a physical copy of Form 49B. You can download it from the government portal, or you can get a copy from any nearby TIN Facilitation Centre (TIN-FC).
2. Fill and Submit: Fill the form neatly in capital letters. You must submit the form in duplicate (two copies) to any TIN Facilitation Centre.
3. Payment: Pay the required fee in cash or by cheque/Demand Draft at the counter.
4. Acknowledgement: The TIN-FC will give you an acknowledgement receipt with a unique number, which you can use to track the status of your application.

Check the Status of the TAN Application

To check the status of your TAN application:

1. Visit the TIN Portal: Go to the TIN NSDL Portal.
2. Select 'Track Your Application': Choose the option to track.
3. Enter Details: Enter your application number and PAN.
4. View Status: Check the current status of your application.

How to Search TAN?

To search for TAN:

1. Visit the TIN Portal: Go to the NSDL TIN website.
2. Select 'Know Your TAN': Click on the ‘Know Your TAN’ option.
3. Enter Details: Provide details like name, address, or PAN number.
4. Get the TAN: After submission, your TAN will be displayed.

TAN Number Rectification and Other Issues

If there are errors in TAN or if you need to rectify it, you can:

1. You cannot use the new TAN application form (Form 49B) for corrections. You need to use the separate "Form for Change/Correction in TAN data".
2. This form can be filled out online on the official NSDL-TIN website, or you can submit a physical copy at any TIN Facilitation Centre
3. In the form, you need to clearly mark the field that needs correction (e.g., Name, Address) and fill in the correct details.
4. Similar to a new application, you will get an acknowledgement slip, which needs to be signed and submitted along with any supporting documents (if required for the change, like a proof of new address).

Customer Support for TAN

For TAN-related queries, you can:

1. Call the NSDL helpline at 1800-222-990.
2. Email at tininfo@nsdl.co.in.
3. Visit the nearest TIN Facilitation Center for direct support.

Conclusion

Understanding TAN, its application process, and its role in TDS ensures that taxes on income are paid correctly and on time. TAN is essential for businesses and individuals handling tax deductions at source. With the updated guidelines for FY 2025-26, filing and managing TAN applications is easier and more streamlined.