PAN and TAN are both very important documents which are required by corporates to ensure that their business runs smoothly. For this reason new initiatives are being taken by the Government to ensure that corporate are allocated these crucial pieces of document in a very short span of time.

Let us thus first understand what are PAN and TAN and why they are so crucial

PAN

Also know as a permanent account number, is a 10-digit alphanumeric number that is allocated to each taxpayer in the country by the Income Tax Department under the guidance of the Central Board of Direct Taxes (CBDT). The primary objective of a PAN is to help track financial transaction which may have a taxable component in them to prevent tax evasion.

TAN

TAN refers to tax deduction and collection account number. Just like PAN, this too is a ten-digit alphanumeric number allocated to those who are supposed to deduct tax at source which is also known as TDS. It is a very important number for corporates because they need to quote the number in TDS or TCS returns. Failing to do so can attract a heavy penalty.

Considering how important both PAN and TAN and the plans of the government of increasing the ease of doing business in India, the Government has decided to issue both these documents in a day.

This does not just apply to the already existing companies but those companies which are being newly floated and incorporated by the MCA can get their PAN and TAN issued in less than 24 hours. All that needs to be done is the company needs to apply online using the E-Biz platform of the CBDT. No physical documentation is required to be submitted.