The Tax Identification Number (11-digit) is allotted by the Commercial Tax Department of the state. The main purpose of allotting this unique number is to monitor all the taxable financial business transactions involving goods and services. The TIN is issued to a business entity for Value Added Tax (VAT). It is mandatory for the business involved in interstate trade. The Commercial Tax Department of each state issues the TIN to ensure tax compliance in India. 

For the purpose of getting a TIN in India, you can apply online or offline through the State Commercial Tax Department and must submit specific documents and follow an online or offline application process.

What is TIN Number in India: Know the Concept

TIN number in India means Tax Identification Number. This 11-digit number is an allotment (by the State Commercial Tax Department where your business is registered) for tracking interstate goods and services trading. All the businesses registered under VAT have to apply for a TIN number.

Unlike the Permanent Account Number (PAN) or the Goods and Services Tax (GST) number, the TIN is a system that ensures entities’ compliance with the VAT payout. An 11-digit TIN has a state code to identify the place of registration of the entity, followed by a unique sequence number allotted to each taxpayer. The TIN system helps the state and central tax authority to monitor business entities that deal with goods and indirect tax payments, as it forms a crucial part of India’s tax regime for businesses that deal with goods.

Although VAT has been incorporated within the broader framework of the GST since 2017, TIN is still important in the context of those businesses that are registered under the old VAT regime, particularly for those with lingering tax liabilities from an earlier period. It is also still an integral part of the indirect taxation process, in particular for those in interstate commerce.

Also Read: Credit Note in GST 

Know the Structure of Tax Identification Number

The Tax Identification Number (TIN) in India has a unique 11-digit format, which helps to identify businesses across the country for tax purposes. The TIN number format enables critical information about the taxpayer’s location and identity. Each unique number can be divided into two parts: the first two digits and the last nine digits. 

The first two digits of the TIN represent the state in which the business is registered. This is assigned by the National Standards to mark the state code. For example, the state code for Maharashtra is 27 and the state code for Delhi is 07.

The next nine digits jointly create a unique number allotted to the businesses by the Commercial Tax Department of the state where the business is located. It has been provided to ensure individual identity for every business in the state’s tax system.

What is TIN Number in India: Know the Importance

The Tax Identification Number is provided to every business in India so that they can safely trade interstate and sell goods. Check the points below to know why the TIN number is important.

1. Tax Compliance: Businesses engaged in selling goods and services (especially VAT products and services) are required to secure a TIN. Without a TIN, businesses cannot file VAT returns, making compliance with state tax laws difficult.
2. Encourages Interstate Commerce: A TIN is required for all businesses that engage in interstate commerce. This facilitates the tracking of tax payments and monitoring of goods sold across the country by the state government. It eliminates the practice of tax evasion and helps smoother transactions.
3. Required for Business Operations: A TIN is needed to issue invoices, purchase orders, and other official documents. It ensures the business is a legal entity that is permitted to conduct business under the state’s tax laws. It also helps the business appear reputable with its suppliers and customers.

What is TIN Number in India: Know the Eligibility Criteria

The eligibility criteria to obtain a Tax Identification Number are as follows:

1. Businesses Engaged in Sales and Purchases

Any business in India which deals with the purchase and sale of goods and services must acquire a TIN number. However, your TIN might not always be asked for because most service providers are now taxed under another tax regime, e.g., GSTIN (Goods and Services Tax Identification Number).

Also Read: GST State Code List

2. Interstate Commerce

If your business is involved in interstate trade or other transactions, you will need a TIN, as you will be liable to collect and pay VAT to the states.

For instance, in interstate business, TIN can track the goods as they move around and calculate tax at each node in their movement.

3. Certain Industry Sectors

Industries that produce or sell liquor, petrol, diesel, or other items that are still brought under the VAT regime need to obtain a TIN. Companies operating in sectors subject to VAT are required to obtain a valid TIN in order to meet local tax regulations.

4. E-commerce Businesses

E-commerce companies that are selling goods online or who are acting as resellers on websites such as Amazon or Flipkart have to get TIN, even if the goods they are selling are outside the VAT category.

5. New and Existing Businesses

Businesses that are starting up (or in the process of starting up) to go into operations or existing businesses that are expanding operations into new territories or products, for example, would also have to apply for a TIN as part of the business model structure that has the potential to be integrated with goods transactions. For those businesses that are already in operation, this could also mean changes to pre-existing registrations as part of a change in tax regime.

What is TIN Number in India: Know the Application Process of TIN?

Check the step-by-step guide on how to get a TIN number in India:

Applying through the State’s Commercial Tax Department

The process of applying for a TIN may vary from state to state. In some states, it can be issued online and in some it is offline. Companies who want to register for the state tax have to make an application either at the state’s tax website or at the Commercial Tax Office in their local district.

Documents Required for TIN Application

The documents required to apply for a TIN are as follows:

• PAN Card of the business entity
• Any identity proof
• Utility bills, rental agreements, or property papers for the business as address proof
• Certificate of registration of the entity (sole proprietorship, partnership, or corporation)
• Photographs of the business owner or partners
• Bank account details

Filing the Application

The TIN can be applied both online and offline. Learn how to apply for a TIN in both formats:

1. Online: Most states have an online system that allows the applicants to fill out the form, attach documents, and make the payment (if applicable). It is the fastest and easiest way to apply for TIN.
2. Offline: If your state does not have the online application procedure as of yet, you’d most likely have to go to the Office of the Commercial Tax In charge to have your forms filled out and your documents eventually uploaded manually to their database.

TIN Registration Fee

The TIN registration cost may vary across states, as will the kinds of norms created in each of those states. Some of the states charge a processing fee for the application. Some states give free applications.

Verification of Application

After filling out the application form the Department of State Tax will check the files provided, verify all the data that the Department has, visit the place of the business premises and check the details from the first step, and finally allow the application to be authentic. 

Issuance of TIN

After that, the State Tax Department will generate a TIN for you. They will send it to your postal address or you can download it from the portal of the Tax Department. They take 7-15 working days to generate the TIN.

State-Specific Variations

The application process may vary slightly from one state to another. You should consult with your respective State Commercial Tax Department to obtain detailed instructions for your region. 

What is TIN Number in India: Common Mistakes to Avoid During Application Process

Getting a Tax Identification Number in India is a tricky task. A large number of business firms get delayed or rejected due to their carelessness in filling out the application. You need to pay attention to the following points to avoid mistakes in your TIN application.

Common Mistakes in TIN Application

The common mistakes when applying for a TIN are as follows:

1. Entering the wrong PIN code
2. Entering the wrong address
3. Incomplete Documentation
4. Discrepancies in Information
5. Not Understanding State-Specific Rules
6. Not Submitting the Application Correctly
7. Missing Deadlines
8. Ignoring Application Status

What is TIN Number in India: Status of TIN Application

After completing the TIN application form, you need to wait for confirmation of your TIN allotment. You should keep track of your TIN processing to avoid any delay or hindrance.

All the states in India provide an easy way to check an applicant’s TIN application status online or offline. Following is the information about how to check it:

1. Online Status Check

The following points show how to check the online status:

• Visit the State’s Commercial Tax Department website, you can see a dedicated section where you can see the status of your TIN application.
• On the official website, navigate to the TIN Status Check Section. This may be under the section titled ‘Services’ or ‘VAT’.
• Enter the application reference number or temporary TIN number given at the time of application. In some cases, PAN card numbers could also be asked.
• After filling in the correct information, you will be able to see the status. When it is “pending” or “in progress,” it is under process. When it is approved, then ‘Approved’ will be stated.

2. Offline Status Check

To check the official status, you must go to the Commercial tax office where you’ve submitted your application. You must bring a copy of your acknowledgement receipt and other important documents. There, you can ask the tax office person in charge to check the status of your TIN application.

What is TIN Number in India: Know the Usage of TIN Number

The TIN is integral to its day-to-day operation for submitting various tax returns, making payments, and issuing invoices. The TIN will need to be used by all Indian business as follows:

Filing VAT Returns

For businesses that operate in states where VAT is applicable, for example, in the case of petroleum products and alcohol, the TIN has to be given to file the quarterly VAT return. The TIN ensures that the tax authorities can track the tax liabilities associated with the business’s transactions.

Interstate Trade

Any business engaged in interstate trade must use the TIN for the purpose of recording and reporting interstate transactions. This includes the movement of goods and services across state boundaries. The TIN ensures that the right taxes are applied and paid in accordance with the state’s policy.

Purchasing from Registered Dealers

Businesses may be asked to furnish the TIN when purchasing goods from another registered dealer or supplier. Having this number makes it easy for both the supplier and buyer to record the purchase and match their respective outputs to inputs in the tax returns. This also enables the purchaser to reclaim input tax paid on the purchase through a credit in the VAT return.

Online Transactions

For online commercial businesses, especially in businesses selling physical forms of goods, the TIN number is very important. The sales invoice and other documents should be filed online, mentioning the TIN number as legal compliance. Every business which uses an online platform such as Amazon or Flipkart for selling its product should have a valid TIN number to operate legally.

Annual Audits and Financial Reporting

The tax filings and the record of the TIN will be checked to make sure that taxes have been reported and paid for the fiscal period being audited. If the business continues to exist, to remain in financial standing and avoid financial penalties, records must also be maintained in relation to the number.

How to Correct or Update Your TIN Number

Maintaining accurate business details is crucial for compliance with tax authorities in India, and the Tax Identification Number plays a key role in this. Hence, you must ensure that the details provided to the authority are accurate. 

Reasons for TIN Correction or Update

Here are the reasons for TIN correction:

• Change in Business Information: If your business address, ownership structure (partnership, corporation, or other business structure), or legal business name changes, you must update your TIN records and inform the IRS of these changes.
• Errors In Application: The TIN number could be incorrectly registered during the first TIN registration process either because of incorrect personal or business data. Upon discovery, the error should be rectified.
• Business Expansion: If your business expands into new areas of operation or new sectors, changes to your business tax registration, including TIN, may be required to keep compliant with differing tax regimes in other states.

Documents Required for TIN Correction

To update or correct your TIN, you will need to provide the following documents:

• A new, updated version of the Aadhaar card, voter ID, or passport with the same details is needed.
• If the business name or registered address has been changed, copies of a certified business license or partnership deed are required. 
• New address proof is required to make a change in business address. New utility bills, rental agreements, or property papers are to be submitted. 
• If you have changed your banking account, a new bank statement or a canceled cheque which reflects the updated bank details can be provided.

• Steps to Correct or Update TIN

Follow these steps to update your TIN details:

• Visit the official website of the Commercial Tax Department of Your State
• Navigate to the online correction form.
• Fill out the form.
• Provide supporting documents that demonstrate the updates or corrections that you require.
• Submit the correction form through the online portal.
• You can also update it physically by visiting the State Tax Office.
• There will be a verification process after your corrections. It may take 7 to 15 days to update the changes. 

Also Read: Bill Payment

How to Cancel Your TIN Number

In case the business is no longer required to have a TIN, because of change in the business model, closure of the business, or for any other reason. In such a situation, you have to inform the concerned authorities to cancel the TIN number. Canceling your TIN number in India is as easy as applying for it.

Reasons for Canceling a TIN

• If the business has ceased operations, it has to cancel its TIN to close the VAT liability with the BIR and prevent it from being considered a tax defaulter.
• Many taxpayers may have switched from VAT compliance to GST compliance and so may want to cancel their TIN to avoid confusion between VAT and GST filings for business sectors that are no longer VAT-compliant.
• Businesses that were earlier in the business of selling goods and are now into providing services, which come under the ambit of GST, can do away with the need for a TIN.

Also Read: Types of GST Returns

Steps to Cancel TIN

Follow these steps to cancel your TIN:

1. Most states provide an online portal where businesses can initiate the process to cancel TINs. Check out the Commercial Tax Department website of your state to get the cancellation form.
2. The form will provide details on the TIN number, business name, and reason for cancellation, so ensure that all fields are properly filled out.
3. Along with the form, businesses may need to submit:

• Certificate of business closure: copy of business termination certificate or correspondence with government authorities.
• Final VAT return, indicating that the business has settled all tax liabilities.
• Proof of transition to GST, if applicable.

1. The state’s tax authority will verify the request, with a focus on verifying that the business has paid all its VAT obligations (e.g., by reviewing tax returns). If the request is approved, the TIN will be canceled.

Important Considerations

Here are the considerations you must ensure during cancellation of your TIN:

• Have all your pending VAT returns submitted and all your pending tax liabilities settled when you request the cancellation of your TIN, or your business could be fined or your request rejected. 
•  If your business has migrated to GST, make sure that you have settled all your VAT obligations before canceling the TIN so you do not get taxed twice. 
•  After canceling the TIN, the business shall retain [in their records] copies of all documents relating to the canceled TIN and the cancellation approval and a final return (if one was filed) for the period the TIN was in effect because the IRS may conduct an audit of that period.

Conclusion

The Tax Identification Number (TIN) remains the central reference number for businesses dealing with the sale of goods and interstate trade and is crucial for ensuring compliance with VAT. It also links to the business’s tax payment record and is used to identify transactions for regulatory purposes. Even as much of the taxation system moves to the new Goods and Services Tax regime, TIN continues to be relevant in some sectors, such as petroleum and alcohol, which still require VAT.

Having a TIN is essential for the legal activity of a business and for compliance with tax obligations. The TIN application process must be done accurately, especially regarding documentation and eligibility points. In addition, the TIN must be protected against fraud and misuse.

Whether you are applying for your first TIN or a company with an active TIN, knowing what a TIN means is important to ensure compliance with the taxation laws in India.

Also Read: Bulk Payment Solution

FAQs

What is a TIN in India?

Tax Identification Number (TIN) is a unique 11-digit number allotted to businesses for tracking VAT and interstate trade. TIN is issued by the Commercial Tax Department of a state in which a business is registered and compulsory for businesses dealing with goods under the VAT regime.

How do I apply for a TIN in India?

You can apply for a TIN by visiting your state’s Commercial Tax Department website or office. For this, you must provide a PAN Card, Address Proof, Business Registration Certificates, and Self-Declaration Form. The application process can be made both online and offline, according to your state’s requirements.

How long does it take to get a TIN?

After applying, it may take 7 to 15 business days to process your TIN application. You can check the status online on the tax department portal of your state.

Is TIN mandatory for all businesses?

A TIN is mandatory for all businesses involved in selling goods, especially businesses involved in interstate trading or under the VAT regime, such as petroleum or alcohol. Service-based businesses or businesses running only with GST may not require to get a TIN.

What is the difference between TIN and GSTIN?

When the state issues a TIN for tracking payments of VAT, it’s used to track transactions under the VAT regime. The Goods and Services Tax (GST) system replaced most other indirect taxes in India and was implemented in 2017. Since then, all businesses that sell goods and services subject to GST must have a unique number for the purposes of that tax regime known as GSTIN.

Can the TIN be applied online?

Yes, you can make an online application for getting a TIN through the official website of the Commercial Tax Department of the respective state.

What is the TIN registration fee?

Generally, there is no fee for applying for a TIN. Some states may charge you for processing it, while some waive the fee. Check with your local tax authority.

What documents are required to apply for a TIN?

Some of the documents required to apply for a TIN are your PAN card, address proof, business registration certificates, identity proof, bank details, passport-sized photographs, and others that are state-specific.

How can I check my TIN application status?

You can track the status of your TIN application by visiting your state’s Commercial Tax Department website and providing the application reference number or TIN.

Can I cancel my TIN?

Indeed, should you find yourself no longer needing your TIN (because your business has ceased trading, for example), you can cancel it. However, you will first have to fill in a cancellation form and submit it to your state’s Commercial Tax Department, along with copies of any final VAT returns and proof of the closure of your business.