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The assessment year(ay) and financial year(fy)

Others 1173 views 4 replies

Ranganathan K

Manager-Accounts & Audit

329 Points Posted on 06 November 2012

I hate the system of using Financial year(FY) and Assessment year(AY) as it creates confusions to the Accountants like me. And it leads us to remit tds/tax remittances to the wrong financial year.

Instead, why not it be only the Financial year(FY) in all formats and forum in all departments.

Further, there is no point in mentioning Assessment year(AY) by the Income tax department as they are not strictly completing the assessments in that year.

So, I request the Finance ministry to kindly look into this and make uniformity in mentioning the year. That is Financial year(FY) which would be helpful to all.

Replies (4)

CA Tushar Singhania

Asst. Manager Accts & Fin.

402 Points Posted on 06 November 2012

Actually most people become used to the concept of FY & AY. The ministry wont do anything about it cos all tax laws use the concept of AY & FY. They will not change the entire act for this reason. Just do what I do the clear the confussion. there are only 2 years in tax 1) Previous Year 2) Assessment Year The ITO's are dumb people and call the relevent year "previous year"

Ranganathan K

Manager-Accounts & Audit

329 Points Posted on 06 November 2012

So, another term "Previous year" is also there in addition to "financial year" & "assessment year". GOD!!!

CA Ayush Agarwal

Kolkata-Pune-Mumbai

27454 Points Posted on 06 November 2012

Dear One,

There is No Concept of Financial Year in Whole Income Tax law.

Only The Word Previous Year & assessment Year is Used.

Ranganathan K

Manager-Accounts & Audit

329 Points Posted on 06 November 2012

Yes sir. You are right. As Income tax law, there are only "Previous year" and "Assessment year". The word "Financial year" also been quoted because it has been globally used in all the corporates and particularly the Accounts personnels.

So, my concern here is in order to avoid this confusion, is it possible to have a common name like "Accounting year" or "Tax year" in all forums.