Financial Year

A financial year is a fixed 12-month accounting period that businesses, governments, and individuals use to record, monitor, and report financial transactions. It serves as the formal time frame for preparing financial statements, filing taxes, auditing accounts, and evaluating financial performance.

In India, the standard financial year runs from:April 1st to March 31st of the following year.For example, FY 2024–25 spans from 1 April 2024 to 31 March 2025.

Why a Financial Year is Important

1. Taxation and Compliance

To simplify compliance during the financial year, businesses and individuals can rely on professional tax filing services online that ensure accurate documentation, timely submissions, and stress-free income tax filing while staying fully compliant with Indian tax regulations.

2. Financial Reporting

Professional assistance in tax return preparation ensures that all financial year transactions are accurately recorded, deductions are correctly claimed, and income tax returns are filed without errors, reducing the risk of notices or compliance issues.

3. Budgeting & Planning

4. Auditing

Common Terms Linked with Financial Year

Example

If a company earns revenue and incurs expenses between April 1, 2024 and March 31, 2025, all these transactions are recorded under Financial Year 2024–25. Taxes on this income will be filed in Assessment Year 2025–26.

Consulting an experienced income tax consultant online can help taxpayers understand deductions, exemptions, and assessment year requirements, ensuring proper tax planning and avoiding penalties while managing financial year income effectively.