The Financial Year is the year in which you earn income and manage your finances. In most countries, it starts on April 1 and ends on March 31 of the following year, for example, from April 1, 2023, to March 31, 2024.
The Assessment Year is the year that follows the financial year. It is the period in which you evaluate and file your income tax returns based on the income earned in the financial year. In our example, 2024–25 will be the assessment year.
The major difference is that the Financial Year is when you earn income, and the Assessment Year is when you report and assess that income for tax purposes.
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