Taxable year

A taxable year is the accounting period, usually 12 months, over which a taxpayer’s income, expenses, and other relevant financial transactions are measured to calculate tax liability. It determines the period for which tax returns are filed and taxes are assessed. The taxable year may coincide with the calendar year or follow a different fiscal year, depending on local tax laws.

Example: In India, the financial year 2025-26 (1st April 2025 to 31st March 2026) serves as the taxable year for individuals and businesses. All income earned during this period is aggregated to determine the total tax payable when filing the Income Tax Return for FY 2025-26.