The Tax Deduction Account Number (TAN) is a 10-digit alphanumeric number issued by the Income Tax Department in India to entities that are responsible for deducting tax at source (TDS) on payments made to others. TDS is a mechanism for collecting tax at the time of payment, rather than waiting until the taxpayer files their annual income tax return.
Who Needs to Apply for TAN?
Any entity that deducts TDS on payments made to others must apply for TAN. This includes :-
- Businesses (companies, partnerships, firms)
- Individuals who are responsible for deducting TDS, such as landlords who pay rent to tenants
- Non-profit organizations
Benefits of TAN Registration
There are several benefits to TAN registration, including :-
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Compliance with TDS Regulations: TAN registration ensures that entities are compliant with TDS regulations and avoid penalties for non-compliance.
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Smooth TDS Processing: TAN facilitates smooth TDS processing and helps entities maintain proper records of TDS deductions.
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Access to Online TDS Services: TAN holders can access various online TDS services, such as online TDS challan submission and TDS return filing.