Sunday, 17 November 2013

Meaning of TDS and TAN

What is TDS?

Taxes are deducted at the time of calculating your income. For example, your are working for a company X. Every money they will be paying you the salary of Rs.350000. If you are looking into your payslip there is a colum name IT which mention the tax amount deducted from your salary. Actully the tax amount is deducted by your company and then pays to the government. Where as if you are not working for any company or doing the professional jobs like Doctor,Charted Accountant(CA),etc. You are liable to pay the tax to the government.

Who is eligible for TDS?

Not every one can deduct the tax at source. You have to apply for the Tax Deduction Account Number(TAN). TAN or Tax Deduction and Collection Account Number is a 10 digit alpha numeric number required to be obtained by all persons who are responsible for deducting or collecting tax. It is compulsory to quote TAN in TDS/TCS return (including any e-TDS/TCS return), any TDS/TCS payment challan and TDS/TCS certificates.

How to apply for TAN?

An application for allotment of TAN is to be filed in Form 49B and submitted at any of the TIN Facilitation Centres meant for receipt of e-TDS returns. Addresses of the TIN FC are available at or TAN is allotted by the Income Tax Department on the basis of the application submitted to TIN Facilitation Centres managed by NSDL. NSDL will intimate the TAN which will be required to be mentioned in all future correspondence relating to TDS/TCS.

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