Tax Year Under the Income Tax Act, 2025 and the End of Assessment Year

Written by CA Nandini Hasija, Krystal7 Consultants. Last updated 23 October 2026.

From 1 Apr 2026, the Income Tax Act, 2025 uses one period: the tax year. Section 3(1) defines it as the twelve month financial year starting on 1 April. It replaces the previous year and the assessment year of the 1961 Act. Income of 1 Apr 2025 to 31 Mar 2026 stays under the 1961 Act as AY 2026-27. Income from 1 Apr 2026 is tax year 2026-27, with its return due in 2027.

This page explains the tax year rule and how the new law labels returns, advance tax, TDS certificates and assessments. It also covers the transition for financial year 2025-26, the first tax year of a new business and a table of old and new terms.

What is the tax year under the Income Tax Act, 2025?

The tax year is the twelve month period of the financial year starting on 1 April. Section 3(1) of the Income Tax Act, 2025 defines it. Income is earned, charged and assessed by reference to that one period. So income earned from 1 Apr 2026 to 31 Mar 2027 is the income of tax year 2026-27.

The text of section 3 is short. Section 3(1) gives the general rule. Section 3(2) deals with a new business, profession or source of income. Section 3 has no provisos.

The Act came into force on 1 Apr 2026. Act 30 of 2025 received assent on 21 Aug 2025. The Income Tax Rules, 2026 were notified on 20 Mar 2026 as G.S.R. 198(E). From that date of commencement, every new provision, form and challan speaks of the tax year.

For a foreign owned Indian company, the tax year is the same twelve months as the financial year it already uses for income tax. Nothing moves in the calendar. What changes is the label, the section numbers and the forms. Our guide to Income Tax Act, 2025 changes for foreign owned companies covers the wider switch.

What did previous year and assessment year mean under the 1961 Act?

Under the Income Tax Act, 1961, income was earned in the previous year and assessed in the following assessment year. Section 3 defined the previous year as the financial year before the assessment year. Section 2(9) defined the assessment year as the twelve months starting 1 April. Income of 2025-26 was therefore assessed in AY 2026-27.

The two labels caused errors for decades. A challan for financial year 2025-26 income needed AY 2026-27. Treaty forms, certificates and notices used either label. Foreign parents read "2026-27" and assumed it meant the year they were in.

The CBDT's FAQs on interplay and transition say it plainly. Answer 1.8 states that the use of the term assessment year has been discontinued. Answer 1.9 says the tax year replaces the previous year, and income is still assessed after the year ends.

When does the tax year replace previous year and assessment year?

The tax year applies from 1 Apr 2026. Tax year 2026-27, from 1 Apr 2026 to 31 Mar 2027, is the first one under the Income Tax Act, 2025. All income of earlier years, including financial year 2025-26, stays under the 1961 Act with its previous year and assessment year labels.

Answer 1.12 of the transition FAQs confirms this. Income earned during financial year 2025-26 is governed by the 1961 Act and assessed in AY 2026-27. Income from 1 Apr 2026 falls under the 2025 Act as tax year 2026-27.

This creates a year in which both labels live side by side. During financial year 2026-27, a company files its AY 2026-27 return under the old Act. It also pays advance tax and deducts TDS for tax year 2026-27 under the new Act. Answer 3.17 calls these two entirely separate compliance obligations.

Income earned	Old label (1961 Act)	Label now	Law that governs it
1 Apr 2024 to 31 Mar 2025	Previous year 2024-25, AY 2025-26	AY 2025-26 (read as tax year 2024-25 where the new Act refers to it)	Income Tax Act, 1961
1 Apr 2025 to 31 Mar 2026	Previous year 2025-26, AY 2026-27	AY 2026-27	Income Tax Act, 1961
1 Apr 2026 to 31 Mar 2027	Would have been AY 2027-28	Tax year 2026-27	Income Tax Act, 2025
1 Apr 2027 to 31 Mar 2028	Would have been AY 2028-29	Tax year 2027-28	Income Tax Act, 2025

Answer 1.11 sets the reading rule for the first row. Where the new law refers to a tax year before 1 Apr 2026, read it as the corresponding previous year. Its example: tax year 2024-25 corresponds to previous year 2024-25 and AY 2025-26.

No AY 2027-28 exists. A contract, board minute or group policy that says "AY 2027-28" means income of tax year 2026-27. We correct such references when we review intra group agreements.

How does section 536 keep the 1961 Act alive for earlier years?

Section 536 repeals the Income Tax Act, 1961 but saves it for tax years beginning before 1 Apr 2026. Returns, assessments, reassessments, appeals, penalties and recovery for AY 2026-27 and earlier continue under the old Act. Options exercised under the old Act, such as section 115BAA, carry over.

The CBDT's clarificatory FAQs on transition provisions, issued in July 2026, apply the rule to proceedings. Answer 3 deals with summons. A proceeding that follows for tax year 2025-26 or earlier starts under the 1961 Act, per section 536(2)(c). Answer 11 lets the Tax Recovery Officer recover demands for periods before 1 Apr 2026 under either Act.

The savings cover the main carry forwards:

1. Losses. Losses determined for AY 2026-27 under the old Act are carried forward and set off in tax year 2026-27 (answer 3.21). The carry forward period continues; it does not restart (answer 3.23).
2. MAT credit. Unused credit under section 115JAA becomes eligible credit under the 2025 Act, with the fifteen year life counted from the year it first arose (answers 2.25 and 2.26).
3. Options. Section 536(2)(f) keeps options such as section 115BAA alive. A company that opted under the old law is in section 200 of the new law.
4. Certificates. A lower deduction certificate under old section 197 stays valid for payments from 1 Apr 2026 if it covered projected receipts of tax year 2026-27 (answer 2.12). New applications use Form 128.

Our page on minimum alternate tax covers how the old MAT credit now works.

How is the first tax year of a new business worked out?

For a business or profession set up during a financial year, the first tax year starts on the date of setting up and ends on 31 March of that financial year. Section 3(2)(a) of the Income Tax Act, 2025 says so. Section 3(2)(b) applies the same rule to a new source of income. Every later tax year is a full twelve months.

Answer 1.10 of the transition FAQs gives an example. A business set up on 1 Dec 2026 has a first tax year from 1 Dec 2026 to 31 Mar 2027.

This can differ from the company's first financial year under company law. Section 2(41) of the Companies Act, 2013 lets a company incorporated on or after 1 January close its first financial year on 31 March of the following year. That first set of accounts can cover up to fifteen months. The first tax year still ends on the first 31 March, so the company prepares tax figures for a shorter period.

The date of setting up a business is a question of fact. On our reading of the case law, it is usually when the business is ready to start, not the date of incorporation. A subsidiary incorporated in July that signs its first service contract with the parent in September may be set up in September.

Section 2(41) also lets a subsidiary of a foreign company use another year end, such as December, with Central Government approval. That approval changes only the company law year. The subsidiary still uses the April to March tax year and prepares tax figures to 31 March. Our batch guide on 31 March versus December year ends covers the reconciliation.

Event date	Companies Act first financial year	First tax year under section 3(2)
Company incorporated and business set up on 10 Aug 2026	10 Aug 2026 to 31 Mar 2027	10 Aug 2026 to 31 Mar 2027
Company incorporated and business set up on 1 Dec 2026	1 Dec 2026 to 31 Mar 2027	1 Dec 2026 to 31 Mar 2027
Company incorporated and business set up on 15 Feb 2027, first accounts to 31 Mar 2028	15 Feb 2027 to 31 Mar 2028	15 Feb 2027 to 31 Mar 2027; then tax year 2027-28
Foreign company first earns royalty from India on 5 Jan 2027	Not applicable	5 Jan 2027 to 31 Mar 2027, under section 3(2)(b)

How are returns labelled under the tax year system?

A return now relates to a tax year and is filed after it ends. Section 263 of the Income Tax Act, 2025 replaces section 139. The return for tax year 2026-27 is due in 2027. A company files by 31 Oct 2027, or by 30 Nov 2027 if it must file the transfer pricing report in Form 48.

Section 263(1)(c) sets four due dates after the tax year:

1. 31 July for most individuals and others not needing an audit.
2. 31 August for non audit business cases and their partners.
3. 31 October for companies and other audited cases.
4. 30 November for those filing a report under section 172 (Form 48, old Form 3CEB).

Answer 3.4 of the transition FAQs says the duty to file for tax year 2026-27 arises after that year ends. No second return is due in 2026 for the months already past.

The return for AY 2026-27 follows the old law. Answer 3.6 says the old ITR forms apply and filers should select AY 2026-27. Answer 3.11 says earlier years keep their old forms. A company files ITR-6 for AY 2026-27. Our guide to ITR-6 for foreign owned companies covers it.

For AY 2026-27, CBDT Circular No. 07/2026 of 29 Sep 2026 moved the return date to 21 Nov 2026 for audited cases without a transfer pricing report. Transfer pricing cases keep 30 Nov 2026.

How are revised, belated and updated returns handled in the transition?

Each return follows the Act of the year it covers. A revised, belated or updated return for AY 2026-27 or earlier stays under the 1961 Act. From tax year 2026-27 these returns fall under section 263 of the Income Tax Act, 2025. It allows a revised return within twelve months from the end of the tax year.

The transition FAQs give the dates for AY 2026-27:

1. Belated return. By 31 Dec 2026, with a section 234F fee of INR 1,000 where total income is up to INR 5 lakh and INR 5,000 otherwise (answer 3.8).
2. Revised return. Before 31 Mar 2027 or the completion of assessment, whichever is earlier (answer 3.7). The Finance Act, 2026 inserted section 234-I to charge a fee on late revision.
3. Updated return. Under section 139(8A) of the old Act, within its time limit (answer 3.9).

For AY 2025-26 and earlier, answer 3.10 says no revised or belated return can be filed after 1 Apr 2026. Only an updated return remains.

How is advance tax labelled under the tax year?

Advance tax is now paid for a tax year, not for an assessment year. Answer 2.15 of the transition FAQs says so and keeps the dates: 15 June, 15 September, 15 December and 15 March, for 15, 45, 75 and 100 percent of the tax. Sections 404 to 408 of the Income Tax Act, 2025 hold the advance tax rules of old sections 208 to 211. Answer 2.15 cites sections 404, 405 and 408(2), which sets the instalments.

The first instalment under the new Act fell due on 15 Jun 2026, for tax year 2026-27 (answer 2.19). The 15 Mar 2026 instalment belonged to financial year 2025-26 and the old Act (answer 2.16). Any shortfall for that year attracts interest under sections 234B and 234C, not the new sections (answer 2.17).

Answer 2.23 asks taxpayers to select AY 2026-27 for payments of financial year 2025-26 income. They select tax year 2026-27 for payments of income from 1 Apr 2026. A self assessment tax payment for AY 2026-27 still falls under section 140A of the old Act (answer 2.22).

The threshold is unchanged. Advance tax applies where the tax for the year, after TDS and TCS, is INR 10,000 or more under section 404 (answer 2.18). Our batch guide to advance tax for companies works through the instalments.

How are TDS statements and certificates labelled?

TDS follows the date of the event. A sum paid or credited up to 31 Mar 2026 is under the 1961 Act and its forms. A sum paid or credited from 1 Apr 2026 is under the Income Tax Act, 2025. It goes in tax year statements: Form 138 for salary, Form 140 for residents and Form 144 for non residents.

Answers 2.4 and 6.1 set the rule. Where credit and payment fall on either side of 1 Apr 2026, the earlier event decides. Answer 2.10 adds that tax deducted on credit under the old Act is not deducted again on payment under the new Act. Interest credited on 31 Mar 2026 and paid in April 2026 stays under the 1961 Act (answer 6.6).

Item	Financial year 2025-26 (AY 2026-27)	Tax year 2026-27
Salary TDS section	Section 192	Section 392(1)
Other TDS and TCS sections	Sections 193 to 196D; 206C	Section 393; section 394
Quarterly statement, salary	Form 24Q	Form 138
Quarterly statement, residents	Form 26Q	Form 140
Quarterly statement, non residents	Form 27Q	Form 144
Quarterly statement, TCS	Form 27EQ	Form 143
Last quarter statement due	31 May 2026 for January to March 2026	31 May 2027 for January to March 2027
Salary certificate	Form 16, by 15 Jun 2026	Form 130, by 15 Jun 2027
Other TDS certificate	Form 16A	Form 131, within 15 days of the statement due date
TCS certificate	Form 27D	Form 133
Tax credit statement	Form 26AS	Form 168 (annual information statement)

The first new statements, for April to June 2026, fell due on 31 Jul 2026 (answer 6.10). Form 131 for that quarter fell due on 15 Aug 2026. Correction statements for financial year 2025-26 and earlier stay under the old framework (answers 6.10 and 6.14).

Answer 2.5 warns deductors to quote the table item of section 393 for payments from 1 Apr 2026. Old codes such as 194C cause validation errors. Our guide to TDS on payments to non residents maps the section 393 table. Our batch guide to TDS returns in Form 27Q and Form 144 covers non resident statements.

How is tax credit matched to the right year?

Credit follows the year of the income, not the date of deposit. Tax deducted on income of financial year 2025-26 is claimed in the AY 2026-27 return under the old Act. Tax deducted on income from 1 Apr 2026 is claimed for tax year 2026-27. Form 168 separates the two.

Answer 6.25 says credit for financial year 2025-26 tax goes in the AY 2026-27 return. Answer 6.26 says the credit follows the income year if the deductor files the last quarter statement correctly. Answer 6.27 says March 2026 deductions map to AY 2026-27, April 2026 deductions to tax year 2026-27, and Form 168 shows them apart.

For a foreign parent, this matters at year end. Royalty credited by the Indian subsidiary on 31 Mar 2026 belongs to AY 2026-27. TDS on it belongs to the old Act, even if deposited on 30 Apr 2026. The parent's Form 16A for that quarter is an old Act certificate.

How are assessments and reassessments labelled?

Assessments now refer to a tax year. Sections 279 to 286 of the Income Tax Act, 2025 hold the reassessment rules that replace sections 147 to 153. Section 280 issues the reassessment notice (old section 148). Section 281 issues the show cause notice (old section 148A). Assessments for AY 2026-27 and earlier stay under the old Act.

Answer 5.6 of the transition FAQs says the new reassessment sections apply to tax year 2026-27. Answer 5.11 says old Act proceedings can still start and finish for assessment years up to AY 2026-27.

The time limits differ by Act:

Notice	1961 Act (AY 2026-27 and earlier)	Income Tax Act, 2025 (tax year 2026-27 onwards)
Show cause notice	Section 148A, 3 years from the end of the assessment year; 5 years where escaped income is INR 50 lakh or more	Section 281, 4 years from the end of the tax year; 6 years in the extended case
Reassessment notice	Section 148, 3 years and 3 months; 5 years and 3 months in the extended case	Section 280, 4 years and 3 months; 6 years and 3 months in the extended case
Earliest notice	Not applicable	No notice within one year from the end of the tax year, section 282(3)
Reassessment order	Old section 153	Section 286(1), within one year from the end of the financial year in which the section 280 notice was served, with extensions (answer 5.9)

The new limits count from the end of the tax year, not the end of an assessment year. Answer 5.8 gives them. Section 282(3) bars any notice within one year from the end of the tax year.

What are the old and new terms side by side?

Most terms foreign owned companies meet have a new number. The table maps the common ones. The form numbers come from the Income Tax Department's form map for the Income Tax Rules, 2026.

Old term or provision (1961 Act)	New term or provision (2025 Act)
Previous year, section 3	Tax year, section 3
Assessment year, section 2(9)	Discontinued; the tax year is used
Return of income, section 139	Section 263
Advance tax, sections 208 to 211	Sections 404 to 408
Interest for late return, section 234A	Section 423
Interest for advance tax default and deferment, sections 234B and 234C	Sections 424 and 425
Interest on excess refund, section 234D	Section 426
Tax audit, section 44AB; Forms 3CA, 3CB, 3CD	Section 63; Form 26
Transfer pricing report, section 92E; Form 3CEB	Section 172; Form 48
MAT, section 115JB; Form 29B	Section 206; Form 66
Concessional company rate, section 115BAA	Section 200
TDS on non residents, section 195	Section 393(2)
Lower deduction certificate, section 197; Form 13	Section 395; Form 128
Remittance forms 15CA and 15CB	Forms 145 and 146
Treaty claim Form 10F	Form 41
Reassessment, sections 147 to 153	Sections 279 to 286
Repeal and savings	Section 536

Our guide to the tax audit in Form 26 covers section 63. Section 426 is our reading of the old section 234D role. The department's FAQ on sections 423 to 426 maps section 423 to old section 234A. It describes section 426 as interest at 0.5 percent a month on a refund that was not due. Old section 234D charged the same rate on an excess refund, so we read section 426 as its successor.

What has happened since this page was first published?

This page first went live on 30 Mar 2026, two days before the new Act started. These events followed:

1. 30 Mar 2026. The Finance Act, 2026 (Act No. 4 of 2026) received assent. It set the rates for tax year 2026-27 and added the twelve month revised return window.
2. 1 Apr 2026. The Income Tax Act, 2025 came into force, and tax year 2026-27 began.
3. 15 Jun 2026. The first advance tax instalment under section 408 fell due.
4. July 2026. The CBDT issued clarificatory FAQs on transition provisions under section 536.
5. 31 Jul 2026. The first quarterly statements in Forms 138, 140, 143 and 144 fell due.
6. 29 Sep 2026. CBDT Circular No. 07/2026 extended the AY 2026-27 tax audit date to 21 Oct 2026 and the return date to 21 Nov 2026 for cases without a transfer pricing report.

Our compliance calendar for 2026-27 lists the dates for both Acts.

What changed in 2026

Topic	Old rule	New rule	Date	Instrument
Period of income	Previous year, assessed in the assessment year	Tax year, assessed after it ends	1 Apr 2026	Income Tax Act, 2025, section 3
First period of a new business	Previous year from set up to 31 March	Tax year from set up to 31 March	1 Apr 2026	Section 3(2)
Year label on challans	Assessment year	Tax year	1 Apr 2026	Transition FAQ answer 2.23
TDS statements	Forms 24Q, 26Q, 27Q, 27EQ	Forms 138, 140, 144, 143	Payments from 1 Apr 2026	Income Tax Rules, 2026
TDS certificates	Forms 16, 16A, 27D	Forms 130, 131, 133	Tax year 2026-27	Income Tax Rules, 2026
Revised return window	Nine months	Twelve months, fee after nine months	1 Apr 2026; AY 2026-27 under the old Act	Finance Act, 2026
Reassessment time limit	3 years and 3 months from end of AY	4 years and 3 months from end of the tax year	Tax year 2026-27	Section 280

Worked example

Two scenarios show how the tax year works in practice. Amounts are in INR.

Scenario 1: a new subsidiary's first tax year. A US company sets up an Indian subsidiary. The subsidiary starts business on 10 Aug 2026 and expects tax of INR 40,00,000 for its first tax year. It has an international transaction with its parent, so it files Form 48.

1. First tax year: 10 Aug 2026 to 31 Mar 2027, under section 3(2)(a).
2. Advance tax by 15 Sep 2026, at 45 percent: 40,00,000 × 45% = INR 18,00,000.
3. Advance tax by 15 Dec 2026, at 75 percent: INR 30,00,000 in total, so INR 12,00,000 more.
4. Advance tax by 15 Mar 2027, at 100 percent: INR 40,00,000 in total, so INR 10,00,000 more.
5. Form 48 and the tax audit report: by 31 Oct 2027, one month before the return.
6. Return for tax year 2026-27: by 30 Nov 2027, under section 263(1)(c).

The 15 Jun 2026 instalment falls before the business existed. The company starts with the September instalment.

Scenario 2: an existing subsidiary through the transition. A UK owned subsidiary has run since 2019 and files Form 3CEB each year. In 2026 and 2027 it meets both Acts.

Date	Obligation	Year	Act
15 Mar 2026	Last advance tax instalment	AY 2026-27	1961
30 Apr 2026	Deposit of TDS deducted in March 2026	AY 2026-27	1961
31 May 2026	Form 27Q and Form 26Q for January to March 2026	AY 2026-27	1961
15 Jun 2026	First advance tax instalment; Form 16 for 2025-26	Tax year 2026-27; AY 2026-27	2025; 1961
31 Jul 2026	Forms 144 and 140 for April to June 2026	Tax year 2026-27	2025
31 Oct 2026	Form 3CEB and tax audit report	AY 2026-27	1961
30 Nov 2026	ITR-6 return	AY 2026-27	1961
31 Mar 2027	Last date to revise the AY 2026-27 return	AY 2026-27	1961
15 Jun 2027	Form 130 for 2026-27	Tax year 2026-27	2025
30 Nov 2027	Return, after Form 48 by 31 Oct 2027	Tax year 2026-27	2025

In the twelve months to 30 Nov 2027 this company files under both Acts. The calendar does not move. Only the forms, sections and labels change on 1 Apr 2026.

Common mistakes

1. Picking the wrong year on a challan. A payment for financial year 2025-26 income needs AY 2026-27; a payment for income from 1 Apr 2026 needs tax year 2026-27. Fix: check the year field before you pay (answer 2.23).
2. Quoting old section codes for new payments. Codes such as 194C fail validation for payments from 1 Apr 2026. Fix: map each payment to its section 393 table item.
3. Treating the 1961 Act as finished. AY 2026-27 returns, audits and reassessment of earlier years all run under it. Fix: keep both Acts in your calendar until the old years close.
4. Expecting two returns in 2026. Only the AY 2026-27 return falls due in 2026. Fix: plan the tax year 2026-27 return for 2027.
5. Matching the first tax year to the first accounts. A company with fifteen month first accounts still has a first tax year ending on the first 31 March. Fix: split the figures at 31 March.
6. Deducting TDS twice across 1 Apr 2026. Tax deducted on a March 2026 credit is not deducted again on an April payment. Fix: tie each payment to its credit entry.
7. Issuing Form 16 for 2026-27 salary. Tax year 2026-27 needs Form 130. Fix: update payroll templates for the new forms.
8. Leaving "AY 2027-28" in documents. That label no longer exists. Fix: replace it with tax year 2026-27 in agreements, board minutes and policies.

Checklist

1. Mark every compliance item in your calendar with its Act and its year label.
2. Update payroll, payables and treasury systems to the new section numbers and form numbers for payments from 1 Apr 2026.
3. Close financial year 2025-26 under the 1961 Act: last TDS deposit, Form 27Q, Form 3CEB, audit and the AY 2026-27 return.
4. Select tax year 2026-27 on challans for advance tax and TDS on income from 1 Apr 2026.
5. Fix the first tax year of any new business or source from its set up date.
6. Carry forward losses, MAT credit and options under section 536, and record their remaining life.
7. Reconcile Form 26AS for AY 2026-27, and Form 168 for tax year 2026-27, with your books.
8. Replace assessment year references in group agreements and policies with tax year references.
9. Diarise the tax year 2026-27 return for 31 Oct 2027, or 30 Nov 2027 with Form 48.

For a review of your transition calendar, email [email protected] with your last return and your TDS statements.

Frequently Asked Questions

What is a tax year under the Income Tax Act, 2025?+

Section 3(1) of the Income Tax Act, 2025 defines the tax year as the twelve month period of the financial year starting on 1 April. Income is charged and assessed by tax year. Tax year 2026-27 runs from 1 Apr 2026 to 31 Mar 2027 and is the first one under the new Act.

Is the assessment year abolished?+

Yes, for income from 1 Apr 2026. The CBDT's transition FAQs say the use of the term assessment year has been discontinued. Income of earlier years, including financial year 2025-26, keeps its assessment year label because the Income Tax Act, 1961 still governs it under section 536.

Which law applies to income earned in financial year 2025-26?+

The Income Tax Act, 1961. Income earned from 1 Apr 2025 to 31 Mar 2026 is assessed in AY 2026-27 on the old forms, including ITR-6 and Form 3CEB. Section 536 of the Income Tax Act, 2025 keeps the old law alive for tax years beginning before 1 Apr 2026.

What is the first tax year for a new business?+

Under section 3(2)(a) of the Income Tax Act, 2025, it runs from the date the business is set up to 31 March of that financial year. A business set up on 1 Dec 2026 has a first tax year from 1 Dec 2026 to 31 Mar 2027. Later tax years are full twelve months.

Does the first tax year follow a company's first financial year?+

No. Section 2(41) of the Companies Act, 2013 lets a company incorporated on or after 1 January close its first accounts on 31 March of the next year. The first tax year still ends on the first 31 March under section 3(2), so the company splits its figures.

When is the return for tax year 2026-27 due?+

In 2027. Under section 263(1)(c) of the Income Tax Act, 2025, a company files by 31 Oct 2027, or by 30 Nov 2027 if it must file Form 48. Non audit business cases file by 31 Aug 2027 and most other individuals by 31 Jul 2027.

Do I file two returns in 2026 because of the new Act?+

No. In 2026 you file only the AY 2026-27 return under the 1961 Act. The duty to file for tax year 2026-27 arises after that year ends on 31 Mar 2027, according to answer 3.4 of the CBDT's transition FAQs.

How is advance tax labelled now?+

By tax year. Advance tax for income from 1 Apr 2026 is paid for tax year 2026-27 under sections 404 to 408 of the Income Tax Act, 2025, on 15 June, 15 September, 15 December and 15 March. Payments for financial year 2025-26 income still select AY 2026-27.

Which TDS forms apply to payments from 1 April 2026?+

Forms 138 for salary, 140 for residents, 144 for non residents and 143 for TCS replace Forms 24Q, 26Q, 27Q and 27EQ. Certificates move to Forms 130, 131 and 133. A sum paid or credited up to 31 Mar 2026 stays on the old forms.

Which Act applies when TDS is credited in March 2026 and paid in April 2026?+

The Income Tax Act, 1961, because the earlier event decides. The CBDT's transition FAQs say no fresh deduction is needed on the April payment. The deposit date does not change the governing law, so the March 2026 deduction goes in the old Form 27Q or 26Q.

What replaces Form 26AS?+

Form 168, the annual information statement under the Income Tax Rules, 2026, for tax year 2026-27 onwards. Credits for financial year 2025-26 still show against AY 2026-27. The CBDT's transition FAQs say the statements separate March 2026 and April 2026 deductions by year.

How long can the department reopen tax year 2026-27?+

Under section 280 of the Income Tax Act, 2025, a reassessment notice can issue within 4 years and 3 months from the end of the tax year, or 6 years and 3 months in the extended case. Section 282(3) bars any notice within one year from the end of the tax year.

Do losses and MAT credit survive the change to tax years?+

Yes. Losses determined for AY 2026-27 carry forward into tax year 2026-27 without restarting their period. Unused MAT credit under section 115JAA becomes eligible credit under the 2025 Act, with the fifteen year life counted from the year it first arose.

Can I still revise my AY 2025-26 return?+

No. The CBDT's transition FAQs say a revised or belated return for AY 2025-26 or earlier cannot be filed after 1 Apr 2026. Only an updated return under section 139(8A) of the 1961 Act remains, within its time limit.

Sources

• Income Tax Department, Section 3, Income Tax Act, 2025 (tax year), accessed 23 Oct 2026, https://www.incometaxindia.gov.in/w/section-3-1
• Income Tax Department, Section 536, Income Tax Act, 2025 (repeal and savings), https://www.incometaxindia.gov.in/w/section-536-1
• Central Board of Direct Taxes, FAQs on interplay and transition to the Income Tax Act, 2025, https://www.incometaxindia.gov.in/documents/81799/11848482/FAQs-on-Interplay-and-Transition.pdf/05f80c1a-073c-a5d7-fb6f-55509242be53?t=1774082865717
• Central Board of Direct Taxes, Clarificatory FAQs on transition provisions, F. No. 370149/107/2026-TPL, July 2026, https://www.incometaxindia.gov.in/documents/81799/15800173/FAQs-on-Transition-Provisions.pdf/f12b6c7c-1023-be74-8a3f-964563286129?t=1783342520234
• Income Tax Department, FAQs and guidance notes on forms as per the Income Tax Rules, 2026, https://www.incometaxindia.gov.in/faqs-and-guidance-notes-on-forms-as-per-income-tax-rules-2026
• Income Tax Department, FAQs on interest under sections 423, 424, 425 and 426, https://www.incometaxindia.gov.in/documents/d/guest/faqs-on-interest-under-section-423-424-425-426
• Ministry of Finance, Memorandum explaining the provisions in the Finance Bill, 2026 (section 263 due dates and revised returns), https://www.indiabudget.gov.in/doc/memo.pdf
• Central Board of Direct Taxes, Circular No. 07/2026, 29 Sep 2026, https://www.incometax.gov.in/iec/foportal/sites/default/files/2026-09/Circular-7-2026.pdf
• Companies Act, 2013, section 2 (definitions, including clause 41), as hosted by the Income Tax Department, https://www.incometaxindia.gov.in/w/section-2-148