business-licenses

TAN Registration

What is TAN?

TAN, or Tax Deduction and Collection Account Number, is a mandatory 10-digit alphanumeric number required for all persons responsible for deducting or collecting tax at source (TDS/TCS) on behalf of the Government of India.

Purpose of TAN

Tax Deducted at Source (TDS) ensures timely collection of taxes and distributes the responsibility of tax payment. Any person deducting tax at source must deposit the amount to the credit of the Central Government while quoting their TAN.

Salaried individuals are not required to obtain TAN. However, proprietorship businesses and other entities must deduct tax at source for specified payments such as:

• Salary
• Payments to contractors or sub-contractors
• Rent payments exceeding ₹1,80,000 per year

TAN Application Process

To obtain a TAN, applicants must submit Form 49B along with the required documents. After verification, the TAN will be allotted to the entity, and it must be quoted in all TDS/TCS returns, payment challans, and certificates.

Benefits of TAN

• Compliance: TAN is essential for entities that deduct or collect tax at source.
• Mandatory Usage: TAN must be quoted in all communications related to TDS/TCS, including returns and challans.
• Not Interchangeable with PAN: PAN is required for filing individual tax returns, whereas TAN is specifically for entities involved in TDS/TCS activities.

Trust and Goodwill

TAN registration promotes transparency, builds trust, and enhances the credibility of businesses in the eyes of clients and the government.