Financial Year (FY)

Definition

A Financial Year (FY), also referred to as the fiscal year, is the 12-month period that runs from April 1 of one calendar year to March 31 of the next calendar year in India. It serves as the standard accounting period during which businesses record their income, expenses, assets, and liabilities. All Indian tax laws, including the Income Tax Act and the Goods and Services Tax Act, operate on this April-to-March cycle, making it the foundational time frame for virtually all financial and compliance activities in the country.

The financial year is distinct from the Assessment Year (AY), which is the year immediately following the financial year. Income earned during a financial year is assessed and taxed in the corresponding assessment year. For example, income earned during FY 2024-25 (April 1, 2024 to March 31, 2025) is assessed in AY 2025-26. This distinction is important for businesses when filing income tax returns, computing advance tax obligations, and scheduling TDS deposits with the government.

For businesses, the end of the financial year is a particularly critical period involving book closure, statutory audits, annual return filings with the MCA, GST annual return preparation, and tax planning. Companies must finalize their balance sheets, profit and loss statements, and all compliance filings within the prescribed deadlines tied to the financial year. OneFinOps helps businesses manage this year-end rush by providing compliance calendars, automated reminders, and streamlined filing workflows that ensure nothing falls through the cracks.

Key Points

• India's financial year runs from April 1 to March 31, and all income tax, GST, and corporate compliance deadlines are anchored to this period.
• The financial year is different from the Assessment Year (AY) — income earned in FY 2024-25 is assessed and taxed in AY 2025-26.
• Advance tax payments must be made in quarterly installments during the financial year: by June 15, September 15, December 15, and March 15.
• Companies must file their annual GST return (GSTR-9) and income tax return within the due dates linked to the close of the financial year.
• Financial year-end is when businesses must finalize balance sheets, conduct statutory audits, and complete annual compliance filings with the MCA and Income Tax Department.