PAN Card - Permanent Account Number (PAN) in India

Permanent Account Number or PAN is a means of identifying various taxpayers in the country. PAN is a 10-digit unique identification alphanumeric number (containing both alphabets and numbers) assigned to Indians, mostly to those who pay tax.

The PAN system of identification is a computer-based system that assigns unique identification number to every Indian tax paying entity. Through this method, all tax-related information for a person is recorded against a single PAN number which acts as the primary key for storage of information. This is shared across the country and hence no two people on tax paying entities can have the same PAN.

When PAN is allotted to an entity, PAN Card too is given by the Income Tax Department. While PAN is a number, PAN Card is a physical card that has your PAN as well as name, date of birth (DoB), and photograph. Copies of this card can be submitted as proof of identity or DoB.

TAN: Tax Deduction and Collection Account Number

The Tax Deduction and Collection Account Number (TAN) is required for people who are deducting or collecting tax at source. There is a penalty of Rs.10,000 for not quoting the TAN. Anyone paying a salary or commission is required to get a TAN.

What is TAN?

TAN is Tax Deduction and Collection Account Number. It is a 10 digit alphanumeric number. This number has to be attained by people who are accountable for deducting tax at source or collecting tax at source. It is compulsory to quote your TAN in TDS or TCS return, payment, certificates, Annual Information Return and other documents.

Every person whose taxes are deducted at source or those who collect tax at source are required to obtain TAN. If a person fails to apply for TAN or do not quote the TAN in the specified documents, then the person will get a penalty of Rs.10,000.

An applicant cannot provide their PAN number in the field where TAN is required to be mentioned and both these number serve different purposes. TAN is an unique identification number that is given to those who are deducting or collecting taxes at source on behalf of the Income Tax Department, PAN is an unique number given to assesses that is individuals and companies.

Who can Apply for TAN?

If you are paying salary or a commission to anyone else, you should have TAN. This includes central or state government or a local authority. It can be a statutory or an autonomous body, a company, a branch or a division of a company, individual or a Hindu Undivided Family, sole proprietor, firms, associations of persons or trusts.