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Step-by-Step Guide: Update Deductee PAN

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Financial Analyst

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Step-by-Step Process to Update PAN of Deductee

PAN (Permanent Account Number) is a key identifier for TDS compliance. Incorrect PAN details of a deductee can lead to mismatches, rejection of TDS returns, and penalties. Here’s a detailed guide to update PAN in TDS records.

1. Identify the PAN Mismatch

Common reasons to update PAN:

  • Deductee’s PAN entered incorrectly in TDS return (Form 24Q or 26Q)
  • Deductee has changed PAN due to reissue
  • Typographical errors while entering PAN in payroll or accounting software

Identifying the mismatch ensures you take corrective action accurately.

2. Gather Required Information

Before updating PAN, collect:

  • Deductee’s correct PAN
  • TAN of the deductor (employer or payer)
  • Deductee details: name, category, and payment type
  • Original TDS payment and challan details

3. Login to the NSDL / TIN Portal

  1. Visit the NSDL TDS e-filing portal.
  2. Login using TAN and password.
  3. Navigate to ‘Correction Statement / Update Deductee PAN’ section.

4. File a Correction Statement

  • Select the TDS return and quarter containing the error.
  • Update the deductee PAN along with other required details (name, amount, section code).
  • Validate all entries carefully to avoid further mismatches.
  • Submit the correction statement.

5. Verify Acknowledgment

  • After submission, download the Correction Acknowledgment Receipt.
  • This serves as proof of PAN update for TDS compliance.

6. Update Payroll / Accounting Records

  • Ensure that payroll software, accounting books, or TDS registers reflect the correct PAN.
  • Future TDS filings should use the updated PAN to prevent mismatches.

7. Important Tips

  • Always verify deductee PAN before filing TDS returns to reduce corrections.
  • Keep digital and physical records of correction statements and acknowledgment receipts.
  • Submit corrections before the annual TDS return deadline to avoid penalties.

Conclusion

Updating a deductee’s PAN in TDS records is essential for error-free compliance and smooth TDS reporting. Following the step-by-step process ensures accuracy, avoids penalties, and maintains proper records for audit and assessment purposes.

Disclaimer: This blog is intended for general informational purposes only. It does not replace professional tax advice. For personalized guidance, consult a qualified tax consultant.

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