Tan was born in Puchong New Village in Selangor on 24 September 1940 to a poor family. He helped out at his parent's hawker stall while still in school. He studied in a missionary school, and after leaving school, he worked as a clerk with Lembaga Lektrik Negara (LLN) while studying part-time to finish his High School Certificate (HSC). He also worked as a laboratory technician with LLN, then moved on to be an investigator of Inland Revenue Board and a tax consultant with Esso.