Can my corporation choose its own fiscal year end in Ontario?
Yes. Unlike individuals (who always have a December 31 tax year), a corporation can choose any month-end as its fiscal year end when it first files a tax return. The first fiscal year starts on the date of incorporation.
The choice can have practical and tax implications. A December 31 year end aligns with many suppliers, lenders, and clients who work on calendar years, which can simplify comparisons. However, other year ends — such as March 31 or June 30 — can provide more time for year-end tax planning and may reduce the workload on your accountant during the peak December/January season.
Once a fiscal year end is established, changing it requires approval from the Canada Revenue Agency and involves filing a short-year return. It is not a trivial change, so it is worth thinking through the right date before your first return.
Keep in mind that even if your corporation has a non-calendar year end, your HST reporting periods are set by the CRA based on your revenue, and payroll remittances follow CRA payroll schedules regardless of fiscal year.
Key takeaways
- A corporation can choose any month-end as its fiscal year end on first filing.
- The choice affects tax planning timing, accountant workload, and lender/client alignment.
- Changing a fiscal year end later requires CRA approval and a short-year return.
- HST and payroll obligations follow their own schedules regardless of fiscal year.