What Is a Tax Year?
A tax year is the 12 months from 1 April to 31 March in which you earn income. Tax Year 2026-27 runs from 1 April 2026 to 31 March 2027. Under the Income-tax Act, 2025, in force from 1 April 2026, it replaces both the “previous year” (the financial year) and the “assessment year”. Work out your tax for it in the Income Tax Calculator.
Tax year vs financial year vs assessment year
Under the old Act, income earned in one financial year was taxed in the next, called the assessment year. The new Act uses one name for one year.
| Income earned | Old names (1961 Act) | New name (2025 Act) | Return filed in |
|---|---|---|---|
| April 2025 to March 2026 | FY 2025-26, AY 2026-27 | Not applicable: last year under the 1961 Act | 2026 |
| April 2026 to March 2027 | FY 2026-27, AY 2027-28 | Tax Year 2026-27 | 2027 |
| April 2027 to March 2028 | FY 2027-28, AY 2028-29 | Tax Year 2027-28 | 2028 |
So “FY 2026-27”, “AY 2027-28” and “Tax Year 2026-27” all point to the same income. The e-filing portal may still label the year as AY 2027-28 for a while; choose the year in which you earned the income.
Which Act applies to which year?
- FY 2025-26 (AY 2026-27): the Income-tax Act, 1961, with the old section numbers such as 80C and 87A. Returns for this year are filed in 2026.
- Tax Year 2026-27 onwards: the Income-tax Act, 2025, with new section numbers such as Section 123 for 80C. See the full old vs new section numbers.
Tax slabs for Tax Year 2026-27
The new regime slabs are the same as for FY 2025-26. Budget 2026 did not change the slabs, the standard deduction or the rebate.
| Taxable income | Rate (new regime) |
|---|---|
| Up to ₹4 lakh | Nil |
| ₹4 lakh to ₹8 lakh | 5% |
| ₹8 lakh to ₹12 lakh | 10% |
| ₹12 lakh to ₹16 lakh | 15% |
| ₹16 lakh to ₹20 lakh | 20% |
| ₹20 lakh to ₹24 lakh | 25% |
| Above ₹24 lakh | 30% |
The rebate makes taxable income up to ₹12 lakh tax-free, and salaried people also get a standard deduction of ₹75,000, so a salary of up to ₹12.75 lakh pays no tax. A 4% cess is added to any tax due. For every deduction and worked example, read the income tax slab guide.
Key dates in Tax Year 2026-27
| Date | What happens |
|---|---|
| 1 April 2026 | Tax year starts; tell your employer which regime you want for TDS |
| 15 June 2026 | First advance tax instalment (15%) |
| 15 September 2026 | Second instalment (45% in total) |
| 15 December 2026 | Third instalment (75% in total) |
| 15 March 2027 | Last instalment (100%) |
| 31 March 2027 | Tax year ends; last day for old-regime investments such as PPF and ELSS to count for it |
Advance tax applies only if your tax after TDS is ₹10,000 or more; the advance tax guide explains who pays and the interest for paying late.
What you need to do differently
- Use the new year names on investment proofs and declarations to your employer.
- Expect new section numbers on your TDS certificate and in the return utility from Tax Year 2026-27.
- Nothing else changes for most salaried people: the same slabs, the same choice between the new and old regime, and the same deductions in the old regime.