If your business deducts or collects tax at source in India, you need a Tax Deduction and Collection Account Number (TAN). TAN registration is mandatory under the Income Tax Act for individuals or organizations responsible for deducting TDS (Tax Deducted at Source) or TCS (Tax Collected at Source).
In this guide, we’ll explain what TAN is, its structure, who must apply, and how to register online.
What is TAN?
TAN stands for Tax Deduction and Collection Account Number. It’s a 10-digit alphanumeric identifier issued by the Income Tax Department to individuals or entities who are required to deduct or collect tax at source.
TAN is mandatory for filing TDS/TCS returns and issuing certificates to deductees. Without a valid TAN, TDS returns cannot be processed, which can lead to penalties.
For more details, visit the official NSDL TAN portal.
Structure of TAN
TAN is a 10-character alphanumeric code. Here’s the breakdown:
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The first four characters are letters.
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The first three letters represent the jurisdiction code.
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The fourth letter is the initial of the deductor’s name.
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The next five characters are numeric.
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The last character is a letter again.
Example: DELT12345K
This format helps the Income Tax Department identify the deductor and the region in which they operate.
Who Needs to Apply for TAN?
TAN registration is compulsory for the following:
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Companies
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Partnership Firms
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Proprietors deducting TDS
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Government Departments
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Trusts and Societies deducting TDS
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Branch offices of companies
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Freelancers or professionals required to deduct TDS
Even individuals running a business or profession crossing the TDS threshold must apply for a TAN.
When is TAN Required?
TAN is required in the following scenarios:
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Deducting TDS on salaries, contractor payments, rent, etc.
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Collecting TCS on specified goods or services
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Filing TDS/TCS returns
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Issuing Form 16/16A/27D
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Payment of TDS to the government
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Making online TDS challans through TIN NSDL portal
How to Apply for TAN Online?
TAN registration can be completed online via the NSDL portal. Here’s a step-by-step process:
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Go to the NSDL TAN application page
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Select your category (Company, Individual, Trust, etc.)
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Fill out Form 49B with required details
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Submit the form and note the acknowledgment number
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Pay the application fee (currently ₹65 including GST)
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Send the signed acknowledgment to the NSDL address or opt for Aadhaar-based e-verification (if available)
Once processed, TAN is issued within 7-10 working days and sent via physical mail and email.
Documents Required for TAN Registration
No documents are required to be uploaded during online TAN application. However, you must ensure that all business details (name, PAN, address) match those in the Income Tax records.
For offline submission, the signed acknowledgment must be sent to: NSDL e-Gov, 5th Floor, Mantri Sterling, Plot No. 341, Survey No. 997/8, Model Colony, Near Deep Bungalow Chowk, Pune – 411016
Penalty for Not Obtaining TAN
If you deduct or collect tax without a valid TAN, you may be liable to a penalty of ₹10,000 under Section 272BB of the Income Tax Act.
Also, filing TDS returns without TAN will be rejected, delaying refunds and increasing the chance of scrutiny or notices.
How to Know Your TAN?
If you’ve already applied and want to track or verify your TAN:
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Use the TAN search tool provided by the Income Tax Department.
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Check your Form 16/26AS for existing TAN details (if previously used).
Conclusion
TAN registration is not optional—it’s a legal requirement for businesses and individuals involved in TDS or TCS. Filing taxes without a TAN can lead to legal consequences and financial penalties.
Make sure your TAN is registered and active before your next TDS cycle. If you’re unsure about the process, consult a tax professional or explore government-approved platforms for easy online application.
