Can an Ontario corporation choose any fiscal year end it wants?

Yes, generally. An Ontario corporation can choose any fiscal year-end it likes when it is first established. Common choices include December 31 (to align with the calendar year), March 31, or another date that suits the business's seasonal cash flow or administrative convenience. The fiscal year cannot exceed fifty-three weeks.

Once set, the CRA registers the fiscal year-end and your T2 corporate tax returns will be due six months after each year-end. Changing your fiscal year-end later is possible but requires CRA approval and some administrative coordination. The CRA generally requires a short-period return for the period before the change takes effect.

Choosing the right year-end can matter more than it first appears. A December 31 year-end aligns with personal tax planning if the owner is extracting salary or dividends, but a different year-end may allow more time to plan before tax returns are due. Year-end choice also affects when annual returns and financial statements must be ready. Working with an accountant when setting up the corporation to choose the best fiscal year-end for your specific situation is time well spent, as the choice can have lasting tax and administrative implications.