Assessment Year and Previous Year are two significant terms used in the Indian Income Tax Act of 1961, and their meanings are as follows:
Previous Year is a term use in the Indian Income Tax Act, 1961, which refers to the specific financial year during which the income is earn. For instance, if the income is generate within the financial year 2022-23, the previous year corresponding to that income would be 2021-22. For instance, if income is earn during the financial year 2022-23, the previous year corresponding to that income would be 2021-22.
Assessment Year is a term use in the Indian Income Tax Act, 1961, which denotes the year immediately succeeding the previous year. In simpler terms, it is the year in which the income earned during the previous year is evaluate, assess, and subject to taxation as per the provisions of the Income Tax Act. For instance, if the previous year is identify as 2021-22, then the corresponding assessment year would be 2022-23.
In simpler terms, the previous year is when the income is earn, and the assessment year is when the income is subject to taxation and evaluation.
FAQs:
What is the Assessment Year?
The Assessment Year is the year in which income earned in the previous year is assessed and taxed. It follows the previous year.
What is the Previous Year?
The Previous Year is the financial year in which the income is earned. It precedes the Assessment Year.
What is the difference between the Previous Year and the Assessment Year?
The Previous Year is when income is earned, while the Assessment Year is when that income is taxed.
When does the Previous Year start and end?
The Previous Year starts on April 1st and ends on March 31st of the following year.
When does the Assessment’s Year start and end?
The Assessment Year starts immediately after the Previous Year, on April 1st, and ends on March 31st of the following year.
Can the Previous Year and Assessment’s Year be the same?
No, the Previous Year and Assessment Year are consecutive years; the Previous Year is when income is earned, and the Assessment Year is when it’s taxed.
Is income earned in the Previous Year taxed in the same year?
No, income earned in the Previous Year is taxed in the subsequent Assessment Year.
How do I file taxes for income earned in the Previous Year?
You file taxes for income earned in the Previous Year during the subsequent Assessment Year.
What is the current Assessment’s Year if the Previous Year is 2022-23?
If the Previous Year is 2022-23, the current Assessment Year is 2023-24.
Why is the distinction between the Previous Year and Assessment Year important?
The distinction helps in determining the timeline for filing taxes and assessing income for tax purposes.
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