1. What is TAN? Is it
compulsory to have for TDS deduction ?
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.
However, a person required to deduct tax under section 194-IA can use PAN in place of TAN as such person is not required to obtain TAN. Further, a person required to deduct tax under section 194-IB or section 194M shall not be required to obtain tax deduction account number (TAN).
TDS is deducted by the person making certain specified
payments at certain rates and threshold limits as prescribed by the Income Tax
The balance amount after the deduction is paid to the recipient
and the amount deducted is paid to the Income Tax department.
The person responsible to deduct TDS is termed as “Deductor”
and the person who receives the payment after tax deduction is termed as “Deductee”.
In simple terms, Form 16 is a certificate provided by the deductor which certifies details regarding the Income you have earned during the year and how much TDS has been deducted.
Form 16 has two
Form 26AS not
only contains the details of your taxes paid but also contains details of any
tax refunds that have been received by you during the past years.