Categories: Direct Tax

Important Concept under Income tax Act

Important Concept under Income tax Act – Concept of Previous Year & Assessment Year

The financial year that ended just before the assessment year is referred to as the previous year. It is the year that expenses are incurred and money is earned. The year that the tax authorities evaluate and impose taxes on the income received in the preceding year is known as the assessment year.

How to make Computation of income?

The systematic presentation of all gains, exemptions, rebates, reliefs, deductions, and the computation of taxes in relation to tax calculation is known as income computation. While there isn’t a set structure for this, the following factors are typically taken into account when calculating revenue.

Income is taxed in the year that it is earned in the following situations

Normally, any income received in the previous year is assessed or subject to tax in the assessment year that follows. The income is taxed in the year that it is earned, though, under the following situations.

Previous Year For Undisclosed Sources of income

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