PAN (Permanent Account Number) is the Tax Identification Number in India, PAN is mandatory for opening Bank Account. PAN is mandatory for applying for GST, Import Export Code (IEC) and Various other registration mentioned above.
In the case of Pvt Ltd company registration, PAN is allotted along with the company incorporation itself. In other cases, PAN needs to be applied for separately.Business entities are required to withhold tax from various payments like Salaries, Rent, professional fees, etc.
Permanent Account Number (PAN) is a mandatory registration with the Income Tax Department of India required for all person and entities that are required to pay Income Tax and perform certain high-value transactions. The Income Tax Department uses the PAN to track all compliance and filings of an Income Tax Assesse using the PAN. PAN is a 10 digit alpha-number character, issued in the form of a laminated card. Once a PAN Card is issued, no continued compliance filings are necessary and it is valid for lifetime of the entity.
PAN is now required in India for entering into many basic transaction like obtaining a telephone connection or paying more than Rs.25,000/- to hotels or restaurants. Therefore, it is recommended for all Indian Residents and Foreign Nationals staying in India for an extended period of time to obtain PAN Card.
Pan Card is valid for the lifetime unless you surrender it to tax authorities. The generation of the PAN is one-time process requires no renewal.
TAN is a number required to remit the tax withheld from vendors and employees. The company can have multiple TAN for different locations. Tax Deduction and Collection Account Number- a 10-digit alphanumeric number issued by the Income Tax Department of India to the person who is required to deduct TDS/TCS while making payment such as salary, commission, rent, contractual expenses, professional fees, etc.
Any person who makes payments such as salary, rent, commission, contractual expenses, etc. and is liable to deduct TDS/TCS as per provisions of Income Tax Act, 1961, shall apply for TAN. This may include Individuals, HUF, Limited liability partnership, Partnership firms, Company, Associates of firms, Local authority or Trust. Note: The provision for obtaining TAN does not apply to the person who is required to deduct TDS as per section 194-IA (i.e. sale proceeds received by the individual in respect of building or land.
TAN or Tax Deduction and Collection Number (TAN) is mandatory 10 digit alpha number required to be obtained by all persons who are responsible for Tax Deduction at Source (TDS) or Tax Collection at Source (TCS) on behalf of the Government. Tax deducted at source (TDS) ensures that the Government’s collection of tax is proponed and the responsibility for paying tax is diversified. The person deducting the tax at source is required to deposit the tax deducted to the credit of Central Government – quoting the TAN number. Individuals who are salaried are not required to obtain TAN or deduct tax at source. However, a proprietorship business and other entities (i.e., Private Limited Company, LLP, etc.,) must deduct tax at source while making certain payment like salary, payments to contractor or sub-contractors, payment of rent exceeding Rs.1,80,000 per year, etc. On deducting tax at source, the entity registered for TAN will issue a TDS Certificate as proof of collection of tax.
As per provision of Income Tax Act, 1961, persons responsible for deducting or collecting tax at source must apply for a TAN number and must quote TAN on all the following documents:
The TAN number is valid for a lifetime unless you surrender it to the tax authorities due to some reasons. The generation of the TAN is a one-time process requires no renewal.