So this is why the financial year closes on 31st March, the tradition has been going on since the British rule.

Financial Year Closing: Today, on 31st March, 2025, the financial year 2024-25 is to be closed. Then the new financial year will start from 1st April. During this time, the account of income and expenditure of taxpayers is prepared. 31st March is also the last day to file ITR. Now the question is coming in your mind that why the financial year closes on 31st March? Let us tell you the reason behind this today.

Rule from the British era

Let us tell you that the tradition of starting the financial year from 1st April has been going on since the British era. It was convenient for them. Even after the country became independent, no changes were made in it and in the constitution also the time period of the financial year has been kept till March-April. Regarding this tradition started in India in 1867, it is said that the Britishers followed the Gregorian calendar of accounting and used to work according to April-March. The same rule was followed during their rule in India.

The whole matter is related to the rent

Another big reason behind this is the crop cycle. We all know that the British used to collect rent from the farmers in India. In those days, due to the tax being collected in the form of farming, the season of sowing and harvesting of crops was taken into account. In India, wheat, gram, mustard and lentil crops are usually harvested in the month of March. The month of March is very important for harvesting Rabi crops and then new crops are planted from April.

These are also the reasons

Apart from this, some experts believe that Hindu New Year starts from 1st April in India, hence the financial year also starts from 1st April. Now this question may also come in the mind of some people that why the financial year does not close in December? Actually, due to the month of December being the festive season, people have a busy schedule, hence there is no closing in this month.