“Tax Compliance Starts Here: Understanding TAN Registration”

21 Jul “Tax Compliance Starts Here: Understanding TAN Registration”

When it comes to tax compliance in India, TAN registration is one of the foundational steps for businesses and individuals responsible for deducting or collecting tax at source. TAN, or Tax Deduction and Collection Account Number, is a 10-digit alphanumeric code issued by the Income Tax Department, essential for tracking TDS (Tax Deducted at Source) and TCS (Tax Collected at Source) transactions.

🔍 Why is TAN Registration Important?

Any entity—be it a company, firm, government body, or individual—liable to deduct or collect tax at source must obtain a TAN. It is mandatory to quote TAN in all TDS/TCS returns, payment challans, and certificates, failing which can lead to hefty penalties.

📝 How to Apply for TAN?

TAN registration can be done online via the NSDL website or offline through Form 49B. The process is quick, and once allotted, TAN remains valid for a lifetime unless canceled or surrendered.

⚠️ Consequences of Not Having TAN

Without a valid TAN:

• TDS cannot be deposited properly

• TDS returns will be considered invalid

• Deductors may face penalties up to ₹10,000 under Section 272BB

• You cannot issue valid TDS certificates (Form 16/16A)

✅ TAN vs PAN – Know the Difference

While PAN is meant for tax payments and income tracking, TAN is specifically required for deducting and remitting TDS/TCS to the government. Both are crucial, but serve entirely different purposes.