Assessment Year vs Tax Year 2026–27

Originally shared on 2026-10-18. This post relates to the periods and dates stated below.

Assessment Year 2026–27 and Tax Year 2026–27 refer to different income periods. Check the year before preparing your tax records.

Income earned during FY 2025–26 belongs to Assessment Year 2026–27 and remains governed by the Income-tax Act, 1961, even when the return is filed after 1 April 2026.

Income earned during FY 2026–27 belongs to Tax Year 2026–27 under the Income-tax Act, 2025. Its return-filing obligation arises after that tax year ends.

For business owners and individual taxpayers, the practical step is simple: keep income, expenses, TDS and advance-tax records separated by the correct period. Check the year selected on challans and reconcile tax credits separately.

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