Difference between TIN, TAN, VAT, PAN, DSC and DIN! Explained

The various new terms that a new entrepreneur comes across are TIN, TAN, VAT, PAN, DSC and DIN. It is quite essential for an entrepreneur to know the meaning of these terms and the differences between them. In this blog, we will discuss in detail the differences and significance of TIN, TAN, VAT, PAN and DIN.

The TIN or VAT

TIN is also known as the Taxpayer Identification Number or the VAT (Value Added Tax) or the CST or the Sales Tax Number. The TIN has been allotted by the Commercial Tax Department of every state and is an eleven-digit unique number. It is compulsory to mention the TIN number on all the transactions that are related to VAT. In order to identify the dealers that have registered themselves with the VAT and to perform interstate sales between two or more states, the Taxpayer Identification Number is used. It is necessary for the businesses that are involved in sale of goods and services such as manufacturers, exporters, dealers, shopkeepers, etc.

The GST or GSTIN

TIN and VAT have been replaced by GST also known as the Goods and Services Tax. On July 1, 2017, the Indian government introduced the GST. It has been mandated by the government to obtain a GST registration to all those organisations who had the VAT or TIN registration. Moreover, any institution which is engaged in the supplying of goods and services whose value exceeds Rs. 20 Lakhs in a single year also has to get a GST registration. All the GST registered entities are given a GSTIN or a GST number.

The TAN Number

TAN number is also known as the Tax Deduction and Collection Account Number. The TAN is an alphanumeric number of ten digits which is provided to those entities who have to deduct the TDS or the tax deducted at source. The TAN number is important for businesses that deduct tax at source and need to be quoted in TDS or TCS return. An entity may be penalised if TAN is not applied when needed. On obtaining the TAN, the entity needs to file for a TDS return on a quarterly basis.

The PAN

PAN is also referred to as the Permanent Account Number. It is a ten-digit alphanumeric number which is unique in nature and is issued to each and every taxpayer like businesses, trusts, individuals, HUFs, foreign citizens and more. It is provided by the Income Tax Department. The PAN is an efficient identification and has been made compulsory for all the Indian Citizens who wish to start a company or an LLP. The income tax department uses PAN in order to keep a track of the financial transactions which may have a taxable part. Now, PAN is also needed for various ordinary activities such as the remitting of high-value cash deposits, purchasing a property, etc.

The DSC

DSC is also known as the Digital Signature Certificate. It is an electronic authorisation format and is used as a proof of the identity of the individual for some specific online transactions and filings. The main entities to use the DSC are the MCA (ROC), Income Tax Department, Directorate General of Foreign Trade, GST registration, EPF and the E-tenders in India. The DSC have been categorised into three different classes namely:

• Class 1: Using Class 1 digital signatures in order to verify an email address that belongs to a certain individual.
• Class 2: Guidelines were issued by the Controller of Certifying Authorities, India(CCA) on November 26, 2020. Under these guidelines, only the class 3 DSCs can be issued from January 1, 2021.
• Class 3: The most secure and safe form of DSC are the Class 3 Digital Signatures and these are needed to establish the signer's identity.

The Class 3 digital signatures are used for the purposes that are listed below:

• MCA e-Filing
• Income Tax e-Filing
• e-Tendering
• LLP Registration
• GST Applica
• e-Binding
• e-Auction and others.

The DIN

DIN is also known as the Director Identification Number and is issued to either the existing directors or to the future directors of the company. The DIN is required for company registration. The Designated Partner Identification Number or the DIN are similar in nature and can be used in the place of each other. DPIN is the number that is required to register an LLP in India. A DIN contains all the personal information of the individual who is the director or is going to be the director. It can be obtained only by humans. Both an Indian or a Foreign citizen can obtain a DIN on submission of their ID and Address Proof and the DSC (Digital Signature Certificate).

Conclusion

In this blog, we discussed about the various important terms for entrepreneurs and the differences between them We discussed TIN or VAT, GST or GSTIN, TAN, PAN, DSC and DIN.