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. Tax is collected by the government in the form of deductions made from the earning you make which can be either in the form of salary, rent, professional fees or interest or any such income. These deductions are made by the person making the payment. The receiver of such income gets net income after deduction of such TDS(Tax deducted at Source).The provisions of Section 203A of the Income-tax Act, 1961 require all persons who deduct or collect tax at source to apply for the allotment of TAN.
It is compulsory to quote TAN in all TDS/TCS returns, payment challans and certificates.