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CS Executive · Tax Laws and Practice · Procedural Compliance under Income Tax

Under the Income-tax Act, 2025 (applicable from the June 2027 session), the accounting period for which income is computed and a return is filed is described by which term?

The term is 'tax year'. The Income-tax Act, 2025 replaces the earlier previous year and assessment year distinction with one tax year, as seen in the provisions on audit of accounts of the tax year. Assessment year and previous year are 1961 Act terms.

  1. ATax yearCorrect
  2. BPrevious year
  3. CAssessment year
  4. DFinancial cycle

Explanation

The Income-tax Act, 2025 uses the single concept of 'tax year' in place of the earlier previous year and assessment year pair. The official text itself refers to 'accounts of the tax year'. 'Assessment year' and 'previous year' belong to the Income-tax Act, 1961.

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