Difference Between TIN and TAN | TIN vs TAN

TIN vs TAN

Difference between TIN and TAN: – A lot of us are heard about TIN and TAN on almost daily basis as business person. People who are not business men or have not any contact with business dealings, then they seems asking free about TIN and TAN or what is difference between TIN and TAN? I think before going towards major differences, let’s see what TIN and what is meant by TAN.

Difference between TIN and TAN

Rules and regulations for tax payments should be effective in order to avoid tax evasion. Governments continually find the ways to increase the means of collecting the tax, since tax payments made by the individuals and corporates are the main source of income for governments. TIN (Taxpayer Identification Number) and TAN (Tax Deduction and Collection Account Number) are two such identifiers to ensure proper tax collection in India.

The main difference between TIN and TAN is that TIN is a unique 11-digit number code issued for sellers and dealers who are liable to pay VALUE-ADDED TAX whereas TAN is a unique 10-digit alphanumeric code issued for those who are in charge of deducting or collecting the tax as an obligatory requirement.

TIN

TIN (Taxpayer Identification Number) is a unique 14-digit numeric code provided for vendors and sellers who are responsible for paying VAT (Value Added Tax). VAT is a type of consumption taxes chargeable whenever a product is added at the time of a final sale. TIN is also known as VAT Number. TIN is issued by the Commercial Tax Section of the respective area or Union Territory (UT). The first 2 digits of TIN are the state code or (UT code). Rest of the 9 digits of TIN differs by state authorities.

Manufacturers, traders, and retailers, who are required to pay taxes, must refer to TIN in all VALUE-ADDED TAX transactions and correspondence. Moreover, TIN will be applied for both sales done within a party or between two or more parties. Regulations for TIN are updated regularly to ensure that proper payment of taxes is being made, and under new rules, there is no big difference between TIN and VALUE-ADDED TAX, as only one number is needed for all such types of sales made.

TAN

As already defined, TAN (Tax Deduction and Collection Account Number) is a unique 10-digit alphanumeric code issued for those who are in charge of deducting or collecting the tax as an important requirement. TAN is given by the Income Taxes Department under section 192A of Income Tax Work, 1961. The key objective of TAN is to make the task of deduction and collection of tax at source, a lot easier.

Major Differences between Both TIN and TAN

  • TIN is a unique 10-digit numeric code given to vendors and traders who are legally responsible to pay VAT.
  • TAN is a unique 10-digit alphanumeric code issued for those who are in charge of deducting or collecting tax as an important requirement.
  • The main purpose of implementation of TIN is to track VAT related activities in the country.
  • The primary purpose of TAN is to simplify deduction and collection of tax at source.
  • TIN is managed by the Commercial Taxes Department of the respected state.
  • TAN is managed by the Income Taxes Department under section 192A of Tax Act, 61.
  • TIN number must be present and in-use by any vendor who is considered responsible to pay VAT.
  • TAN needs to be possessed by every individual/entity that has to deduct or acquire tax at source of income.

Now after reading these major differences you must have a clear about both TIN and TAN, especially what is difference between both of them. Keep visiting the website to learn more about such business terms, which confuses us a lot in our day to day lives.