Fiscal year

Part of a series on
Accounting
Historical cost Constant purchasing power Management Tax
show Major types Audit Budget Cost Forensic Financial Fund Governmental Management Social Tax
show Key concepts Accounting period Accrual Constant purchasing power Economic entity Fair value Going concern Historical cost Matching principle Materiality Revenue recognition Unit of account
show Selected accounts Assets Cash Cost of goods sold Depreciation / Amortization Equity Expenses Goodwill Liabilities Profit Revenue
show Accounting standards Generally-accepted principles Generally-accepted auditing standards Convergence International Financial Reporting Standards International Standards on Auditing Management Accounting Principles
show Financial statements Annual report Balance sheet Cash-flow Equity Income Management discussion Notes to the financial statements
show Bookkeeping Bank reconciliation Debits and credits Double-entry system FIFO and LIFO Journal Ledger / General ledger T accounts Trial balance
show Auditing Financial Internal Firms Report
show People and organizations Accountants Accounting organizations Luca Pacioli
show Development History Research Positive accounting Sarbanes–Oxley Act
show Misconduct Creative Earnings management Error account Hollywood Off-balance-sheet Two sets of books
v t

A fiscal year (or financial year, or sometimes budget year) is used in government accounting, which varies between countries, and for budget purposes. It is also used for financial reporting by businesses and other organizations. Laws in many jurisdictions require company financial reports to be prepared and published on an annual basis but generally not the reporting period to align with the calendar year (1 January to 31 December). Taxation laws generally require accounting records to be maintained and taxes calculated on an annual basis, which usually corresponds to the fiscal year used for government purposes. The calculation of tax on an annual basis is especially relevant for direct taxes, such as income tax. Many annual government fees—such as council tax and license fees, are also levied on a fiscal year basis, but others are charged on an anniversary basis.

Some companies, such as Cisco Systems,^[1] end their fiscal year on the same day of the week each year: the day that is closest to a particular date (for example, the Friday closest to 31 December). Under such a system, some fiscal years have 52 weeks and others 53 weeks.^[2]

The calendar year is used as the fiscal year by about 65% of publicly-traded companies in the United States and for most large corporations in the United Kingdom.^[3] That is the case in many countries around the world with a few exceptions such as Australia, New Zealand, and Japan.^[4]

Many universities have a fiscal year which ends during the summer to align the fiscal year with the academic year (and, in some cases involving public universities, with the state government's fiscal year) and also because the university is normally less busy during the summer months. In the Northern Hemisphere, that is July to the next June. In the Southern Hemisphere, that is the calendar year, January to December.

Some media/communication-based organizations use a broadcast calendar as the basis for their fiscal year.

In some countries, the fiscal year is denoted by the calendar year in which it begins and so in India, for instance, spending incurred in March 2022 would be part of the fiscal year 2021, operating on a fiscal calendar of April–March. In other countries, the fiscal year is denoted by the calendar year in which it ends and so in the United States, federal government spending incurred on 14 November 2021 would belong to fiscal year 2022, which operates on a fiscal calendar of October–September.^[5]

Chart of various fiscal years[]

Start date of fiscal year by country hide

Country/Region	Purpose	(Jul)	(Aug)	(Sep)	(Oct)	(Nov)	(Dec)	Jan	Feb	Mar	Apr	May	Jun	Jul	Aug	Sep	Oct	Nov	Dec	(Jan)	(Feb)	(Mar)
Australia
Austria
Bangladesh
Belgium
Brazil
Canada	government
	corporate/personal
China
Costa Rica
Egypt
Ethiopia		8 July
France
Germany
Greece
Hong Kong
India
Indonesia
Iran										21 March
Israel
Italy
Japan	government/corporate(typical)
	personal
Mexico
Moldova
Nepal		16 July
Netherlands
New Zealand	government
	corporate/personal
Pakistan
Portugal
Qatar
Republic of Ireland
Romania
Russia
Singapore	government
	personal
South Africa
South Korea
Spain
Sweden	personal
	corporate
Switzerland
Taiwan
Thailand
Turkey
United Arab Emirates
United Kingdom	personal										6 April
	corporate/government
United States	federal
	most states
	corporate/personal
Country/Region	Purpose	(Jul)	(Aug)	(Sep)	(Oct)	(Nov)	(Dec)	Jan	Feb	Mar	Apr	May	Jun	Jul	Aug	Sep	Oct	Nov	Dec	(Jan)	(Feb)	(Mar)

Tax year[]

The fiscal year for individuals and entities to report and pay income taxes is often known as the taxpayer's tax year or taxable year. Taxpayers in many jurisdictions may choose their tax year.^[6] Some federal countries, such as Canada and Switzerland, require the provincial or cantonal tax year to align with the federal year. In the United States, most states retained a 30 June fiscal year-end date when the federal government switched to 30 September in 1976. Nearly all jurisdictions require that the tax year be 12 months or 52/53 weeks.^[7] However, short years are permitted as the first year or when changing tax years.^[8]

Most countries require all individuals to pay income tax based on the calendar year. Significant exceptions include:

• Australia: individuals pay income tax based on the financial year of 1 July until 30 June.^[9]
• United Kingdom: the tax year for individuals begins on 6 April. This is due to Britain historically having a calendar year starting on Lady Day (25 March) in the Julian calendar but a fiscal year ending on that day. When the UK adopted the Gregorian calendar in 1752, 25 March translated to 5 April and 26 March to 6 April. (See History of taxation in the United Kingdom#Why the United Kingdom income tax year begins on 6 April for more detailed explanation.)
• United States: individuals may (but rarely do) elect any tax year, subject to IRS approval.^[10]

Many jurisdictions require that the tax year conform to the taxpayer's fiscal year for financial reporting. The United States is a notable exception: taxpayers may choose any tax year, but must keep books and records for such year.^[7]

Operation in various countries/region[]

In some jurisdictions, particularly those that permit tax consolidation, companies that are part of a group of businesses must use nearly the same fiscal year (differences of up to three months are permitted in some jurisdictions, such as the U.S. and Japan), with consolidating entries to adjust for transactions between units with different fiscal years, so the same resources will not be counted more than once or not at all.^{[citation needed]}

Afghanistan[]

In Afghanistan, the fiscal year was changed from 21st or 22 March – 20th or 21 March (1 Hamal – 29/30 Hoot) to 21 – 20 December (1 Jadi – 30 Qaws) in 2011.^[11] The fiscal year runs with the Afghan or Solar Hijri calendar, because of the differing cycle of leap years in the Gregorian and Afghan calendars, there can be slight differences in the start date of fiscal (and calendar) years. As shown in the chart below, leap years will coincide in 2020 and 2024 but will desynchronize with the Gregorian calendar having a leap year in 2028 as opposed to the Afghan calendar's leap year of 2029.

Correspondence of Solar Hijri and Gregorian calendars (Solar Hijri leap years are marked *)^[12]

33-year cycle[13]	Solar Hijri year	Gregorian year	Solar Hijri year	Gregorian year
1	1354*	21 March 1975 – 20 March 1976	1387*	20 March 2008 – 20 March 2009
2	1355	21 March 1976 – 20 March 1977	1388	21 March 2009 – 20 March 2010
3	1356	21 March 1977 – 20 March 1978	1389	21 March 2010 – 20 March 2011
4	1357	21 March 1978 – 20 March 1979	1390	21 March 2011 – 19 March 2012
5	1358*	21 March 1979 – 20 March 1980	1391*	20 March 2012 – 20 March 2013
6	1359	21 March 1980 – 20 March 1981	1392	21 March 2013 – 20 March 2014
7	1360	21 March 1981 – 20 March 1982	1393	21 March 2014 – 20 March 2015
8	1361	21 March 1982 – 20 March 1983	1394	21 March 2015 – 19 March 2016
9	1362*	21 March 1983 – 20 March 1984	1395*	20 March 2016 – 20 March 2017
10	1363	21 March 1984 – 20 March 1985	1396	21 March 2017 – 20 March 2018
11	1364	21 March 1985 – 20 March 1986	1397	21 March 2018 – 20 March 2019
12	1365	21 March 1986 – 20 March 1987	1398	21 March 2019 – 19 March 2020
13	1366*	21 March 1987 – 20 March 1988	1399*	20 March 2020 – 20 March 2021
14	1367	21 March 1988 – 20 March 1989	1400	21 March 2021 – 20 March 2022
15	1368	21 March 1989 – 20 March 1990	1401	21 March 2022 – 20 March 2023
16	1369	21 March 1990 – 20 March 1991	1402	21 March 2023 – 19 March 2024
17	1370*	21 March 1991 – 20 March 1992	1403*	20 March 2024 – 20 March 2025
18	1371	21 March 1992 – 20 March 1993	1404	21 March 2025 – 20 March 2026
19	1372	21 March 1993 – 20 March 1994	1405	21 March 2026 – 20 March 2027
20	1373	21 March 1994 – 20 March 1995	1406	21 March 2027 – 19 March 2028
21	1374	21 March 1995 – 19 March 1996	1407	20 March 2028 – 19 March 2029
22	1375*	20 March 1996 – 20 March 1997	1408*	20 March 2029 – 20 March 2030
23	1376	21 March 1997 – 20 March 1998	1409	21 March 2030 – 20 March 2031
24	1377	21 March 1998 – 20 March 1999	1410	21 March 2031 – 19 March 2032
25	1378	21 March 1999 – 19 March 2000	1411	20 March 2032 – 19 March 2033
26	1379*	20 March 2000 – 20 March 2001	1412*	20 March 2033 – 20 March 2034
27	1380	21 March 2001 – 20 March 2002	1413	21 March 2034 – 20 March 2035
28	1381	21 March 2002 – 20 March 2003	1414	21 March 2035 – 19 March 2036
29	1382	21 March 2003 – 19 March 2004	1415	20 March 2036 – 19 March 2037
30	1383*	20 March 2004 – 20 March 2005	1416*	20 March 2037 – 20 March 2038
31	1384	21 March 2005 – 20 March 2006	1417	21 March 2038 – 20 March 2039
32	1385	21 March 2006 – 20 March 2007	1418	21 March 2039 – 19 March 2040
33	1386	21 March 2007 – 19 March 2008	1419	20 March 2040 – 19 March 2041

Australia[]

In Australia, a fiscal year is commonly called a "financial year" (FY) and starts on 1 July and ends on the next 30 June. Financial years are designated by the calendar year of the second half of the period. For example, financial year 2017 is the 12-month period ending on 30 June 2017 and can be referred to as FY2016/17. It is used for official purposes, by individual taxpayers and by the overwhelming majority of business enterprises.^[9] Business enterprises may opt to use a financial year that ends at the end of a week (e.g., 52 or 53 weeks in length, and therefore is not exactly one calendar year in length), or opt for its financial year to end on a date that matches the reporting cycle of its foreign parent. All entities within the one group must use the same financial year.

For government accounting and budget purposes, pre-Federation colonies changed the financial year from the calendar year to a year ending 30 June on the following dates: Victoria changed in 1870, South Australia in 1874, Queensland in 1875, Western Australia in 1892, New South Wales in 1895 and Tasmania in 1904. The Commonwealth adopted the near-ubiquitous financial year standard since its inception in 1901.^[14] The reason given for the change was for convenience, as Parliament typically sits during May and June, while it was difficult for it to meet in November and December to pass a budget.^[14]

The Financial year is split into the following four-quarters^[15]

Quarter	Period covered
Quarter 1	1 Jul – 30 Sep
Quarter 2	1 Oct – 31 Dec
Quarter 3	1 Jan – 31 Mar
Quarter 4	1 Apr – 30 Jun

Austria[]

In Austria, the fiscal year is the calendar year, 1 January to 31 December.

Bangladesh[]

In Bangladesh, the fiscal year is 1 July to the next 30 June.^[16]

Belarus[]

In Belarus, the fiscal year is the calendar year, 1 January to 31 December.^[17]

Brazil[]

In Brazil, the fiscal year is the calendar year, 1 January to 31 December.

Bulgaria[]

In Bulgaria, the fiscal year is the calendar year, 1 January to 31 December, both for personal income tax^[18] and for corporate taxes.^[19]

Canada[]

In Canada, the government's financial year is 1 April to 31 March.^[20]
(Q1 1 April - 30 June, Q2 1 July - 30 Sept, Q3 1 Oct - 31 Dec and Q4 1 Jan - 31 Mar)

For individual taxpayers, the fiscal year is the calendar year, 1 January to 31 December.

China[]

In China, the fiscal year for all entities is the calendar year, 1 January to 31 December, and applies to the tax year, statutory year, and planning year.^[21]

Colombia[]

In Colombia, the fiscal year is the calendar year, 1 January to 31 December.

Costa Rica[]

In Costa Rica, the fiscal year is 1 January to 31 December.

Egypt[]

In Egypt, the fiscal year is 1 July to 30 June.^[22]

France[]

In France, the fiscal year is the calendar year, 1 January to 31 December, and has been since at least 1911.^[23]

Greece[]

In Greece, the fiscal year is the calendar year, 1 January to 31 December.

Hong Kong[]

In Hong Kong, the government's financial year runs from 1 April to 31 March.^[24][25]

However, a company incorporated in Hong Kong can determine its own financial year-end, which may be different from the government fiscal year.

India[]

In India, the government's financial year runs from 1 April to 31 March.^[26] It is abbreviated on the basis of the ending year, thus the current financial year 1 April 2021–31 March 2022 is abbreviated as FY 22.^{[27][failed verification]}

Companies following the Indian Depositary Receipt (IDR) are given freedom to choose their financial year. For example, Standard Chartered's IDR follows the UK calendar despite being listed in India. Companies following Indian fiscal year get to know their economical health on 31 March of every Indian financial or fiscal year.

The current fiscal year was adopted by the colonial British government in 1867 to align India's financial year with that of the British Empire.^[28][29] Prior to 1867, India followed a fiscal year that ran from 1 May to 30 April.^[30]

In 1984, the LK Jha committee recommended adopting a fiscal year that ran from 1 January to 31 December. However, this proposal was not adopted by the government fearing possible issues during the transition period.^[30] A panel set up by the NITI Aayog in July 2016, recommended starting the next fiscal year from 1 January to 31 December after the end of the current five-year plan.^[31]

On 4 May 2017, Madhya Pradesh announced that it would move to a January–December financial year, becoming the first Indian state to do so. But later it dropped the idea.^[32]

Indonesia[]

In Indonesia, the fiscal year is the calendar year, 1 January to 31 December.^[33]

Iran[]

In Iran, the fiscal year usually starts on 21st or 22 March (1st of Farvardin in the Solar Hijri calendar) and concludes on next year's 20th or 21 March (29th or 30th of Esfand in the Solar Hijri calendar).^[34]

Ireland[]

In Ireland, the fiscal year is the calendar year, 1 January to 31 December. Until 2001, it was the year ending 5 April, as in the United Kingdom, but was changed with the introduction of the euro. The 2001 tax year was nine months, from April to December.^[35]

Israel[]

In Israel, the fiscal year is the calendar year, 1 January to 31 December.^[36]

Italy[]

In Italy, the fiscal year is the calendar year, 1 January to 31 December. It was changed in 1965, before which it was 1 July to 30 June.^[37]

Japan[]

In Japan, the government's financial year is from 1 April to 31 March.^[38] The fiscal year is represented by the calendar year in which the period begins, followed by the word nendo (年度); for example the fiscal year from 1 April 2021 to 31 March 2022 is called 2021–nendo.

Japan's income tax year is 1 January to 31 December,^[39] but corporate tax is charged according to the corporation's own annual period.^[40]

Lithuania[]

In Lithuania, the fiscal year is the calendar year, 1 January to 31 December.^[41]

Macau[]

In Macau, the government's financial year is 1 January to 31 December.

Mexico[]

In Mexico, the fiscal year is the calendar year, 1 January to 31 December.

Moldova[]

In Moldova, the fiscal year is the calendar year, 1 January to 31 December.^[42]

Myanmar/Burma[]

In Myanmar, the fiscal year is 1 October to 30 September.^[43]

Nepal[]

In Nepal, the fiscal year is July 16 (1 Shrawan in Bikram calendar) to July 15 (31 Ashad in Bikram calendar).^[44]

New Zealand[]

In New Zealand, the government's fiscal^[45] and financial reporting^[46] year is 1 July to the next 30 June^[47] and applies also to the budget. The company and personal financial year^[48] is 1 April to 31 March and applies to company and personal income tax.

Pakistan[]

In Pakistan, the government's fiscal year is 1 July of the previous calendar year and concludes on 30 June. Private companies are free to observe their own accounting year, which may not be the same as government's fiscal year.^[49]

Poland[]

In Poland, the fiscal year is from 1 January to 31 December.

Portugal[]

In Portugal, the fiscal year is the calendar year, 1 January to 31 December.

Qatar[]

In Qatar, the fiscal year is from 1 January to 31 December.

Romania[]

In Romania, the fiscal year is the calendar year, 1 January to 31 December.^[50]

Russia[]

In Russia, the fiscal year is the calendar year, 1 January to 31 December.^[23]

Singapore[]

In Singapore, the fiscal year for the calculation of personal income taxes is 1 January to 31 December.^[51]

The fiscal year for the Government of Singapore and many government-linked corporations is 1 April to 31 March.^[4]

Corporations and organisations are permitted to select any date as the end of each fiscal year, as long as this date remains constant. However, new companies should consciously choose their financial year end to stretch as much as a duration of 12 months as possible.^[52]

South Africa[]

In South Africa, the fiscal year for the Government of South Africa is 1 April to 31 March.^[4]

The year of assessment for individuals covers twelve months, 1 March to the final day of February the following year. The Act also provides for certain classes of taxpayers to have a year of assessment ending on a day other than the last day of February. Companies are permitted to have a tax year ending on a date that coincides with their financial year. Many older companies still use a tax year that runs from 1 July to 30 June, inherited from the British system. A common practice for newer companies is to run their tax year from 1 March to the final day of February following, to synchronize with the tax year for individuals.^{[citation needed]}

South Korea[]

In South Korea, the fiscal year is the calendar year, 1 January to 31 December.^[53]

Spain[]

In Spain, the fiscal year is the calendar year, 1 January to 31 December.^[54]

Sweden[]

In Sweden, the fiscal year for individuals is the calendar year, 1 January to 31 December.^[55]

The fiscal year for an organisation is typically one of the following:

• 1 January to 31 December
• 1 May to 30 April
• 1 July to 30 June
• 1 September to 31 August

However, all calendar months are allowed. If an organisation wishes to change into a non-calendar year, permission from the Tax Authority is required.^[56][57]

Switzerland[]

In Switzerland, the fiscal year is the calendar year, 1 January to 31 December.^[58]

Taiwan[]

In Taiwan, the fiscal year is the calendar year, 1 January to 31 December. However, an enterprise may elect to adopt a special fiscal year at the time it is established and can request approval from the tax authorities to change its fiscal year.^[59]

Thailand[]

In Thailand, the government's fiscal year (FY) is 1 October to 30 September of the following year.^[60] For individual taxpayers it is the calendar year, 1 January to 31 December.

Turkey[]

In Turkey, the fiscal year is the calendar year, 1 January to 31 December.^[61]

Ukraine[]

In Ukraine, the fiscal year is the calendar year, 1 January to 31 December.^[62]

United Arab Emirates[]

In the United Arab Emirates, the fiscal year is the calendar year, 1 January to 31 December.^[4]

United Kingdom[]

In the United Kingdom, the financial year runs from 1 April to 31 March for the purposes of government financial statements.^[63][64] For personal tax purposes the fiscal year starts on 6 April and ends on 5 April of the next calendar year.^[65]

Although United Kingdom corporation tax is charged by reference to the government's financial year, companies can adopt any year as their accounting year: if there is a change in tax rate, the taxable profit is apportioned to financial years on a time basis.^[66]

A number of major corporations that were once government-owned, such as BT Group and the National Grid, continue to use the government's financial year, which ends on the last day of March, as they have found no reason to change since privatisation.^{[citation needed]}

The 5 April year end for income tax reflects the old civil and ecclesiastical calendar under which New Year began on 25 March (Lady Day). The difference between the two dates is accounted for by the eleven days omitted in September 1752 due to the Calendar (New Style) Act 1750 by which the Great Britain also converted from the Julian Calendar to the Gregorian Calendar. However, although the calendar year finished on 24 March, the tax year finished a day later, on 25 March, the Quarter Day.

For a fuller explanation about the history of the United Kingdom income tax year and its start date, see History of taxation in the United Kingdom#Why the United Kingdom income tax year begins on 6 April.

United States[]

Federal government[]

In the United States, the federal government's fiscal year is the 12-month period beginning 1 October and ending 30 September the following year. The identification of a fiscal year is the calendar year in which it ends; thus, the current fiscal year is 2021, often written as "FY2021" or "FY21", which began on 1 October 2020 and will end on 30 September 2021.

Prior to 1976, the fiscal year began on 1 July and ended on 30 June. The Congressional Budget and Impoundment Control Act of 1974 made the change to allow Congress more time to arrive at a budget each year, and provided for what is known as the "transitional quarter" from 1 July 1976 to 30 September 1976. An earlier shift in the federal government's fiscal year was made in 1843, shifting the fiscal year from a calendar year to one starting on 1 July.^[67]

For example, the United States government Fiscal Year 2021 is:

• 1st quarter: 1 October 2020 – 31 December 2020
• 2nd quarter: 1 January 2021 – 31 March 2021
• 3rd quarter: 1 April 2021 – 30 June 2021
• 4th quarter: 1 July 2021 – 30 September 2021

State governments[]

State governments set their own fiscal year. Forty-six of the fifty states set their fiscal year to end on 30 June.^[68] Four states have fiscal years that end on a different date:

• Alabama, ends 30 September
• Michigan, ends 30 September
• New York, ends 31 March
• Texas, ends 31 August

The fiscal year for the Washington, D.C., government ends on 30 September.^[69]

Among the inhabited territories of the United States, most align with the federal fiscal year, ending on 30 September. These include American Samoa, Guam, the Northern Mariana Islands and the U.S. Virgin Islands.^[68] Puerto Rico is the exception, with its fiscal year ending on 30 June.

Businesses and organizations[]

The tax year for a business is governed by the fiscal year it chooses. A business may choose any consistent fiscal year that it wants; however, for seasonal businesses such as farming and retail, a good account practice is to end the fiscal year shortly after the highest revenue time of year. Consequently, most large agriculture companies end their fiscal years after the harvest season, and most retailers end their fiscal years shortly after the Christmas shopping season.

See also[]

• 4–4–5 calendar

References[]

Further reading[]

• "CIA world factbook - Fiscal Years 2080". Central Intelligence Agency.
• "CIA world factbook - Fiscal Years 228". Central Intelligence Agency.