Glossary term
Assessment Year (AY)
The year in which a financial year's income is assessed for tax. AY = FY + 1.
The Assessment Year (AY) is the year in which a previous financial year's income is filed and assessed for tax. For income earned in FY 2025-26, the AY is 2026-27. ITRs for FY 2025-26 are filed in AY 2026-27 (deadline 31 July 2026 for most individuals).
The distinction matters when reading ITR forms and tax notices — both years are usually mentioned.