Taxable period
A jurisdiction may adopt the term "taxable period" if its fiscal year or tax year does not coincide with the calendar year.
The fiscal period for different countries and jurisdictions
Hong Kong
1. Hong Kong adopts term of "year of assessment", which is the same as the fiscal period that runs from 1st April to 31st March.
2. The financial year is the accounting reference period as defined under the Companies Ordinance. In tax terms, the financial year is known as the "basis period". The basis period is a 12-month period. The year of assessment is the period in which the last day of the basis period falls.
3. For example, if the financial year of a company is ended on 31 December 2018 (the basis period), the financial year comes under the year of assessment 2018/19. If the financial year is ended on 30 April 2019, it falls under the year of assessment 2019/20.
Japan
1. For individuals, the tax year runs from 1st January to 31st December.
2. For corporations, the tax year is the same as the business year in respect of which the financial reports are prepared. (i.e. for Toyota, its taxable period is a 12-month period ended on 31st March that is the same as Japan's fiscal period).
Singapore
1. Basis Period and Year of Assessment in Singapore
2. A company is taxed on the income earned in the preceding financial year. This means that income earned in the financial year 2018 will be taxed in 2019. In tax terms, using the same example as above, 2019 is the Year of Assessment (YA). In other words, the YA is the year in which your income is assessed to tax.
3. To assess the amount of tax, the Inland Revenue Authority of Singapore (the IRAS) looks at the income, expenses, etc. during the financial year. This financial year is known as the "basis period".
4. The basis period is generally a 12-month period preceding the YA.
Examples Based on Different Financial Year Ends
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Financial Year End
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Basis Period
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YA
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31 Mar of each year
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1 Apr 2017 - 31 Mar 2018
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2019
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30 Jun of each year
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1 Jul 2017 to 30 Jun 2018
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2019
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31 Dec of each year
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1 Jan 2018 - 31 Dec 2018
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2019
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The same rule applies to new companies.
https://www.iras.gov.sg/irashome/Businesses/Companies/Learning-the-basics-of-Corporate-Income-Tax/Overview-of-Corporate-Income-Tax/
The United Kingdom
In the United Kingdom, the financial year runs from 1 April to 31 March for the purposes of government financial statements. For personal tax purposes, the fiscal year starts on 6 April and ends on 5 April of the next calendar year.
[1] Income Tax and Capital Gain Tax *, both of which apply to individuals, sole proprietors, and partnerships:
- The taxable period is a tax year. [Section 259NF of the Taxation (International and Other Provisions) Act 2010]
- A year for which income tax is charged is called a tax year. A tax year begins from 6th April to 5th April the following year. [Section 4(2) and 4(3) of the Income Tax Act 2007]
- A year of assessment means a tax year. [Section 989 of the Income Tax Act 2007]
- The basis period of a tax year, defined under Chapter 15, Part 2 of the Income Tax (Trading and Other Income) Act 2005, is the period of 12 months ending with the accounting date in that tax year.
- See also the reference information about Basis period and Accounting period [read]
* Capital gains tax [Taxation of Chargeable Gains Act, 1992]
(1) Capital gains tax is charged for a tax year on chargeable gains accruing in the year to a person on the disposal of assets.
(2) As a result of section 4 of Corporation Tax Act 2009 (CTA 2009), capital gains tax is not charged on gains accruing to a company (see below **), but corporation tax is chargeable instead in accordance with—
(a) section 2 of CTA 2009,
(b) Chapter 2 of this Part (Taxation of Chargeable Gains Act, 1992), and
(c) other relevant provisions of the Corporation Tax Acts. [CTA 2009, and CTA 2010]
[2] Corporation Income Tax
- The term "taxable period" in relation to a corporation is an accounting period.
- Section 2(1) of the Corporation Tax Act 2009 (the CTA 2009) provides that "corporation tax is charged on profits of companies for any financial year for which an Act so provides".
- A financial year begins in April and ends in March of the following year.
- Section 8(2) of the CTA 2009 provides that corporation tax is calculated and chargeable, and assessments to corporation tax are made, by reference to accounting periods.
- An accounting period is defined under sections 9 and 10 of the Corporation Tax Act 2009 (CTA 2009).
- Section 9 {extract}
(1) An accounting period of a company begins—
(a) when the company comes within the charge to corporation tax, [section 2, CTA 2009] or
(b) immediately after the end of the previous accounting period of the company, if the company is still within the charge to corporation tax.
(2) For the purposes of this section, a UK resident company is treated as coming within the charge to corporation tax when it starts to carry on business, if it would not otherwise be within the charge to corporation tax.
(3) If a chargeable gain or allowable loss accrues to a company at a time which is not within an accounting period of the company—
(a) an accounting period of the company begins at that time, and
(b) the gain or loss accrues in that accounting period.
(1) An accounting period of a company comes to an end on the first occurrence of any of the following—
(a) the ending of 12 months from the beginning of the accounting period,
(b) an accounting date of the company,
(c) if there is a period for which the company does not make up accounts, the end of that period,
(d) the company starting or ceasing to trade,
(e) if the company carries on only one trade, coming, or ceasing to be, within the charge to corporation tax in respect of that trade,
(f) if the company carries on more than one trade, coming, or ceasing to be, within the charge to corporation tax in respect of all the trades it carries on,
(g) the company becoming, or ceasing to be, UK resident...
** Meaning of a "company"
The general definitions of "company", "profits" and "income" in this guidance manual are set out below. However, a meaning may be different in particular circumstances. If so, the meaning should be clear from the context of the guidance, or will be spelt out in the relevant legislation.
"Company" in the Corporation Tax Acts means "any body corporate or unincorporated association, but does not include a partnership, a co-ownership scheme as defined by Financial Services and Markets Act 2000 (FSMA00/S235A), a local authority or a local authority association" (Corporation Tax Act 2010, CTA10/S1121(1)).
Fiscal Year for Jurisdictions All Over the Globe [read]
Most countries have the fiscal year run from 1st Jan to 31st Dec each year. However, some countries with the fiscal year running for a period other than the calendar year
- From 1st April to 31st March: Canada, Japan, Hong Kong, Singapore, South Africa, the United Kingdom
- from 1st July to 30th June: Australia, New Zealand
- from 1st Oct to 30th Sept: Thailand, the U.S.
