FY:- Meaning of Financial Year in India

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The financial year in India begins on 1st April of the calendar year and ends on 31st March of the next calendar year, in certain cases the financial year may be different from the previous year. In this article, we have put all details about a Financial Year in India.

Financial Year

In simplest words, a financial year is a year in which you earn income. The Balance Sheet and Income statements of companies across the globe are usually prepared for a period of 1 year. However, the date from which period to which period differs from country to country.

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Sometimes a financial year is also called a fiscal year or sometimes a budget year. it also varies from country to country and also depends on the situation.

Also Read- Income Tax Slab Applicable to Individual for FY 2020-21

Financial Year in India

In India, this 1 year period starts from 1st April and ends on 31st March. The Income Tax Returns are filed and taxes for a person are usually paid in the next year after the end of the financial year.

For Example- If income is earned in May 2020 or says in February 2021, then the financial year for this month is 2020-21 i.e. 1st April 2020 to 31st March 2021 and this period is called “Financial Year 2020-21”. The income of this year will be assessed in Assessment Year 2021-22, i.e. next year.

In tax terms, the financial year is also denoted to “FY”, which simply means Financial Year.

Some FAQs for Financial Year in India

Some FAQs
  1. What is meant by Financial Year?

    A Financial Year refers to the period between 1 April and 31 March, in which you earn an income from your business, salary, let out or through any other sources, etc.

  2. What is India’s Financial Year?

    Financial Year in India begins on 1st April of a calendar year and ends on 31st March of the next calendar year.

  3. What is FY?

    In India, FY refers to financial year, it refers to the period between 1 April and 31 March

  4. How long is financial year?

    A financial year is normally one year period from 1st April to 31st March of next year. It is normally used for accounting purposes.

  5. What is calendar year and financial year?

    A calendar is always from 1st January to 31st December and the financial year normally starts from 1st April to end on 31st March or it may differ at some times.

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Disclaimer: The information contained in the above article are solely for informational purpose after exercising due care. However, it does not constitute professional advice or a formal recommendation. The author does not own any responsibility for any loss or damage caused to any person, directly or indirectly, for any action taken on the basis of the above article.

Feedback/Suggestion- Hope you all find it useful, please give your valuable feedback & let us know if there is an error. Thanks in Advance

Compiled by- CA Chirag Agarwal (Practicing Chartered Accountants)

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