16 Dec 2017Posted By: chaman

Why TAN is Required to every business?


What Is a TAN?

TAN is an alphanumeric ten digit number allotted by Income Tax Department. It is to be taken by all businesses, whether it is a small proprietorship or big billion company. It is compulsory for every business which needs to deposit tax at source. 

Every business is required to deduct the TDS of their vendor while making payment if the amount exceeds threshold limit. Threshold limits differs based on nature of payment such as for rent – limit is INR 1,80,000/-, for professionals – limit is INR 30,000/-, etc

The amount deducted in the form of tax is then deposited to the credit of the central government.

Non-deduction and deposit of TDS will lead to various penalties under the Income tax act,1961 and also led to disallowances of expenses while computing profit of business for the purpose of income tax.

TDS is required to be deposited on or before the 7th day of next following month. Non-depositing of TDS shall cause payment of interest.


About TDS Returns

The government has clearly mentioned/specified the due dates to deposit TDS in India. These are-



Due Date of Filing Return


1st April to 30th June

31st July



1st July to 30th September

31st October


1st October to 31st December

31st January


1st January to 31st March

31st May


You shall be penalized by late fees if TDS returns not filed within aforesaid due dates. The fee is generally very high  i.e. INR 200 per day and has to be deposited on the basis of the number of days till TDS return filed.


Some Importance facts about TAN

1. Any person or business which is liable to deposit tax deducted at source requires TAN. It is issued for a lifetime and is mentioned while depositing returns, challans, and certificates.

2. It is required to be a quote in the filing of all types of TDS/ TCS returns, challans or certificates.

3. Without TAN number, no TDS returns are accepted. This can create a major problem if one is eligible for TDS refund.

4. Banks also deny challans which do not carry TAN.

5. Other Obligations:

If a person fails to pay to the credit of the Central Government the tax deducted at source by him, he/she shall be punishable with rigorous imprisonment for a term which shall not be less than three months. The term can extend up to 7 years with fine.

They are also eligible for interest on the monthly basis in case of a deposit of TDS amount after the due date.

A heavy penalty is also burdened on the person or company which is not depositing TDS even after one year of the due date.


In case you need assistance with on TAN Number you can fill out our inquiry form and arrange a call from E-Startupindia business advisors at 8881069069.



Posted By Asim Modi
Posted Date 2018-05-15 23:10:43

I have a sole proprietorship firm and taking an office on rent. My annual turnover is below Rs. 1 crore and I do not have any TAN number. My Landlord is NRI . I understand that I need to deduct 30.9% TDS. Do I need to take TAN number or I can simply deposit the TDS with Tax authorities. Please advise.

Posted By CHETAN
Posted Date 2020-01-29 15:45:14


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