Assessment Year retires. Tax Year takes over.
From 1st April 2026, a small but significant change has quietly reshaped the way we talk about taxes. The familiar term “Assessment Year” or AY has been replaced with “Tax Year” or TY, and while it may sound simple, it is taking some getting used to.
For years, taxpayers and professionals alike have been comfortable saying AY 26-27 while referring to income of FY 25-26. This shift to TY 26-27 (FY 26-27) requires a bit of mental rewiring, especially for those who have worked with the old terminology for decades.
At a glance
| Income earned in | Law that applies | How it is referred to |
|---|---|---|
| April 2025 to March 2026 | Income Tax Act 1961 | AY 2026–27 (FY 2025–26) |
| April 2026 to March 2027 | Income Tax Act 2025 | TY 2026–27 |
In reality, Assessment Year was largely a term used by tax professionals and often ended up confusing many taxpayers. In that sense, moving away from AY does make practical sense and aligns with the broader goal of simplification.
Yet, beyond logic, there is a sense of nostalgia attached. Assessment Year has been a constant in the tax ecosystem for years. Its exit marks the end of an era.
You did your job well, Assessment Year. You will be missed.
Saurabh Jain, Taxology India
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