Tax year
The 12 months from 1 April to 31 March whose income is taxed. It replaced 'previous year' and 'assessment year' in 2026.
The tax year is just the year your income is earned, named once. The old law used two names for one period: the previous year, when you earned, and the assessment year, when it was taxed. The Income-tax Act, 2025 drops that and calls it the tax year.
Read what else changed in India’s new Income-tax Act, 2025: what changed for you.
Questions people ask
What is a tax year?
Under the Income-tax Act, 2025, the tax year is the twelve months of the financial year starting on 1 April. Income earned from 1 April 2026 to 31 March 2027 is tax year 2026-27.
Is the assessment year gone?
Under the new Act, yes. The terms previous year and assessment year are replaced by a single term, tax year, for income earned from 1 April 2026. Income earned before that, up to 31 March 2026, is still handled under the old 1961 Act and its familiar terms.
Is the tax year the same as the financial year?
For most people, yes: both run from 1 April to 31 March. The Act allows a shorter first tax year for a new business or a new source of income.
One money lesson, in your inbox
A short, plain money lesson built from real news. Free. Unsubscribe anytime.
We will never spam you or sell your details. How we handle your email