TAN or Tax Deduction Account Number is a 10 digit alpha numeric number required to be obtained by all persons who are responsible for deducting or collecting tax. It is compulsory to quote TAN in TDS/TCS return (including any e-TDS/TCS return), any TDS/TCS payment challan and TDS/TCS certificates.
Who must apply for TAN and why it is necessary to have TAN?
All those persons who are required to deduct tax at source or collect tax at source on behalf of Income Tax Department are required to apply for and obtain TAN. The provisions of section 203A of the Income-tax Act require all persons who deduct or collect tax at source to apply for the allotment of a TAN. The section also makes it mandatory for TAN to be quoted in all TDS/TCS returns, all TDS/TCS payment challans and all TDS/TCS certificates to be issued. Failure to apply for TAN or comply with any of the other provisions of the section attracts a penalty of Rs. 10,000/-.
GENERAL INFORMATION FOR TAN APPLICANTS:
In case the applicant has already been allotted a ten digit alphanumeric TAN, having or using more than one TAN is illegal. However, different branches/divisions of a deductor/collector may apply for separate TAN for each branch/division.