Discover TAN Number: Importance, Full Form & Why it’s Mandate for Salaried Individuals

Last Updated : May 22, 2023, 3:46 p.m.

TAN is a ten-digit number given to the persons who collect or deduct tax. Everybody has their own distinctive TAN number. The TAN number is a part of the IT Act of 1961.

The TAN full form is Tax Deduction and Collection Account Number. It is in alphanumeric format and given to all individuals paying TDS (Tax Deducted at Source). The TAN number is mandatory to have under Indian norms. A salaried individual must have their TAN number, or vast charges will be taken over by the government.

What is TAN number? What information must you know about TAN? This article will discuss all such questions.

What is TAN Number?

Each individual gets a unique TAN number. The TAN full form – Tax Deduction and Collection Account Number is an amalgamation of numerals and alphabets. Its setting consists of four alphabets at the beginning, five numerals in the middle and 1 alphabet at the end.

TAN Number structure

A TAN full form – Tax Deduction and Collection Account Number is a ten-digit number of great importance as it is required in the taxation process of TDS. If one does not possess a TAN number, there can be legal actions and financial penalties.

Note that the TAN number can be assigned to a company or an individual. If it is for any business, the business will be considered as an individual.

Here is the structure of the TAN full form – Tax Deduction and Collection Account Number:

1. The first three-digit alphabet is a jurisdiction code given to the person.
2. The fourth alphabet represents the TAN-holder’s name.
3. The following five numerics are tentative numbers given to the holder.
4. The final digit of the TAN number is a distinctive number assigned to each TAN holder.

Suppose the TAN number is  MANK55555C. It is an imaginative representation of the TAN full form as a TAX deduction and collection account number.

In MANK55555C, MAN is the jurisdiction code, and K is the initial alphabet of the TAN-holder’s name. The last five numbers are IDs. The last alphabet is a unique identifying character.

What are the Categories of TAN Applicants?

Two kinds of applicants are there when it comes to the TAN full form – Tax Deduction and Collection Account Number:

Category 1

The first category is when someone wants to apply for a new TAN full form – Tax Deduction and Collection Account Number. In this case, you can only visit online to NSDL portal. You will have to submit documents such as PAN card, Name, Address and contact details. They will ask you to pay Rs. 65, which includes 18% of the GST. In addition to online completion, you can also complete the process offline.

Category 2

The second category includes the applicants who want modifications or corrections. In this case, you have specific areas you need to change, such as the TAN number, nationality, name, etc. It provides space for modification. The fee of Rs. 63 is mandatory to complete the process.

How to Apply for TAN Online?

Follow these steps to apply for the TAN online.

1. First, land on the NSDL portal
2. After entering the portal, you will be on the Register Yourself page. The page will ask for your details. Remember to fill them mindfully without any mistakes. The segments will include your name, address and PAN number.
3. After uploading the details, an acknowledge page will pop up. You will need to save the credentials until you receive your number. It will have your fourteen-digit acknowledgement number, contact and payment info and area to give your signature.
4. Don’t forget to sign the application before submitting it.
5. You can add a thumb impression, which needs to be verified by a magistrate or officer.
6. You can pay the amount via check or Demand Drafts. There is room for online transfers as well.

How to Apply for TAN Offline?

Undoubtedly, the online procedure is more convenient, but some may need to apply for TAN offline for various reasons. Here is the process for applying for the TAN full form – Tax Deduction and Collection Account Number offline.

1. You will need a copy of Form 49 B. Many find it tough to download the form, but it is simple. You can download it from the official website of IT or get it through the TIN-FC centre.
2. After filling out the form, you will get your TAN number. You don’t need to provide any documents while applying offline.

Check Your TAN Status

Once you have successfully made your application, you will receive the TAN full form – Tax Deduction and Collection Account Number shortly. But how to check the status? For that, you need the acknowledgement number to check your status. Here is the process to check the status of your TAN Number:

1. Jump into the NSDL portal in your browser.
2. Then, tab into the TAN option.
3. You will see a “know the application’s status” option when you select this option. Here, tap on the ‘Choose your application type.’
4. They will ask for the acknowledgement number.
5. After putting in the acknowledgement number, click submit.

These few steps will redirect you to your TAN status.

Comparison between TAN and PAN

Taxpayers can get their TANs and PANs from the income tax department. But people are often puzzled between TAN and PAN, but the two are entirely different from each other.

Here is the comparison to identify their differences.

1. The PAN number is for all financial transactions, but TAN smoothen the TDS process.
2. PAN requires form 49A (49AA for foreigners), while TAN requires form 49B.
3. You must produce ID proofs and photographs to avail of PAN. However, you can avail of TAN offline without any documents.

Conclusion

The TAN full form – Tax Deduction and collection account number is crucial for the working professional or an entity. Someone who fails to have the number is penalised enormously by the government. Even if you find any error, consider correcting it for smooth and hassle-free procedures.

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