What is the Difference Between TIN and TAN Regarding Income Tax?

The government of India levies taxes on the income earned by individuals and corporations. With different types of taxes and their associated tax numbers, it is common for the taxpayers to get confused regarding the numbers applicable to varying circumstances. For instance, TIN and TAN play critical roles when filing tax returns for corporate entities. 

But what do these numbers mean? How are they different from each other? Let’s find out 

What is TIN?

TIN or Taxpayer Identification Number is an 11-digit registration number allocated to every organisation, enterprise, or businessperson liable to pay VAT (Value Added Tax) in India. Every state in India has a Commercial Tax Department which issues TIN to eligible entities. 

Manufacturers, dealers, and traders should mandatorily mention their TIN for every inter-state and intra-state VAT transaction. The first two characters in TIN denote the state code. For instance, ‘01’ is the state code for Jammu and Kashmir (JK), and ‘27’ is the state code for Maharashtra (MH).  

What is TAN?

TAN or Tax Deduction and Collection Account Number is a 10-digit alpha-numeric number assigned to every individual/entity responsible for deducting TDS (Tax Deducted at Source) or collecting TCS (Tax Collected at Source). The Income Tax Department issues TAN to the applicants based on their applications submitted to NSDL online or offline. 

The first four characters of TAN are alphabets, followed by five numbers and an alphabet in the end. For instance, the TAN issued to someone might look like PDAS12345A. As per the directives of the tax department, TAN should be quoted in the following scenarios:

  • Filing TDS or TCS statements or returns
  • TDS/TCS payment challans
  • TDS/TCS certificate
  • Statement of reportable accounts or financial transactions
  • Other documents as may be prescribed by the tax department

Differences Between TIN and TAN

Some of the most significant differences between TIN and TAN are highlighted below:

Parameter TIN TAN
Issued by Individual Commercial Tax Department of every state Income Tax Department
Purpose Tracking VAT-related transactions Streamline tax deduction and collection at source
Form for applying Varies between states Form 49B
Code type 11-digit numerical code 10-digit alpha-numeric code
Applicable to Any organization or businessperson liable to pay VAT Any entity responsible for deducting or collecting tax at source
Documents required to apply Documents vary between states but generally include PAN, registration proof, ID proof, etc. Only duly filled Form 49B
Maximum TIN/TAN an entity is eligible for 1 1
Penalty for not having TIN/TAN Varies between states Up to ₹10,000


How is PAN Different from TIN and TAN?

Taxpayers should mandatorily have PAN (Permanent Account Number). PAN is also a unique 10-digit alpha-numeric number issued by the Income Tax Department to everyone who pays income tax, files an income tax return, or carries out financial transactions.  

Apart from individuals, even Indian and foreign companies should mandatorily have PAN. A PAN card is also required to apply for TIN. 

Understanding TIN and TAN to Streamline Taxes

TIN and TAN are two of India’s most critical tax-related numbers for corporate entities and businesspersons. If you are liable to pay VAT or deduct/collect taxes at source, ensure that you have TIN/TAN as per the applicability. 

News Reporter