The 2020 tax year is the assessment year 2020-21 and previous year 2019-2020 in India. A financial year (FY) is the period between 1st April to 31st March, the year in which a taxpayer earns his income. This income is subject to tax in the assessment year.
An assessment year starts just after the financial year. In an assessment year the income of a taxpayer is assessed and tax liability arises. Both the assessment year and the financial year start from 1st April and end on 31st March.
Example- For the Financial Year (FY) 1st April 2020- 31st March 2021, the assessment year is 1st April 2021- 31st March 2022
The most recent tax financial year is 1st April 2020- 31st March 2021 and the assessment year for this FY is 1st April 2021- 31st March 2022.
Below is a list of recent financial years and assessments years
|Period||Financial Year||Assessment Year|
|1 April 2020 to 31 March 2021||2020-21||2021-22|
|1 April 2019 to 31 March 2020||2019-20||2020-21|
|1 April 2018 to 31 March 2019||2018-19||2019-20|
|1 April 2017 to 31 March 2018||2017-18||2018-19|
The tax liability on an income earned by a taxpayer depends on the type of taxpayer and the applicable tax slab.
|Type of taxpayer||Tax Exempt||Net Income||Tax Liability|
|Individual||Income up to Rs. 2,50,000||Rs. 1,00,000||NIL|
|Senior Citizen||Income up to Rs. 3,00,000||Rs. 1,00,000||NIL|
|Super Senior Citizen||Income up to Rs. 3,00,000||Rs. 1,00,000||NIL|
|Hindu Undivided Family||Income up to Rs. 2,50,000||Rs. 1,00,000||NIL|
|Partnership Firm’s, LLP & Local Authority||Applicable Tax Rate of 30%(excl surcharge and cess)||Rs. 1,00,000||Rs. 30,000|
|Domestic Company||Applicable Tax Rate of 30%(excl surcharge and cess)||Rs. 1,00,000||Rs. 30,000|
The fiscal year across the globe usually starts from 1st january and end on 31st December. However this period differs from country to country. India both the fiscal year and the financial year start from 1st April and end on 31st March.
As per the Income Tax Act, 1961 there are 2 tax years, financial year and assessment year. Both the FY and AY start from 1st April and end on 31st March.
The financial year is the same as fiscal year but the assessment year is the succeeding year of the financial year. Both the FY/ fiscal year and AY are a period of 12 months.
Example- For the fiscal year / financial year 1st April 2020- 31st March 2021, the assessment year is 1st April 2021- 31st March 2022
The period of accounting of income and expenditure is called the accounting year or financial year. Both the accounting year and the financial year is the same in India
Taxation on mutual funds is a complex topic. Taxes paid on your mutual fund investments vastly depend on factors such as what kind of funds you have invested in, the duration of your investment, which income tax slab you belong to and so on.