Fiscal Year

The fiscal year (or financial year) is the 12-month period at the end of which a company prepares its accounts and files its tax returns. A company (incorporated company, a "corporation") is not required to have a December 31st closing date; all its financial obligations begin from its closing date.

Brief

A 12-month period at the end of which profit and tax are calculated.
A company (incorporated company) can end its year on a date other than December 31st.
This end date sets all your deadlines: corporate tax returns (T2 at the federal level, CO-17 in France) and advance tax payments.
A self-employed worker (a person engaged in independent activity) follows the calendar year, from January 1st to December 31st.

Why does this matter?

Think of it as your company's "New Year": you choose it. A business overwhelmed in December would be better off ending its year in March rather than on December 31st, to take inventory and finalize accounts in peace and quiet. This date is decided from the outset, as it dictates all your tax deadlines: a poorly chosen date will leave you scrambling during peak season. Bankeo will connect you with a verified accountant/CPA free of charge, who will help you choose the best date, and we'll be there to support you every step of the way.

Frequently asked questions

What exactly is a financial exercise?

This refers to the 12-month period your business uses to add up its sales, expenses, and profits, and then file its tax returns. It's not necessarily from January 1st to December 31st.

Am I required to finish by December 31st?

A company (incorporated company) can choose a different end date, for example March 31 or June 30. A self-employed individual, however, follows the calendar year which ends on December 31.

Can I change my end date to a later date?

Yes, but you need authorization from the tax authorities (the tax administration of the Canada and Revenu Québec) and this complicates your tax returns. It's best to choose wisely from the start. Bankeo will introduce you to a verified accountant/CPA free of charge for this purpose, and we'll be there to support you every step of the way.