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. In federal countries (e.g., United States, Canada, Switzerland), state/provincial/cantonal tax years must be the same as the federal year. Nearly all jurisdictions require that the tax year be 12 months or 52/53 weeks. However, short years are permitted as the first year or when changing tax years.
Most countries require all individuals to pay income tax based on the calendar year. Significant exceptions include:
- United Kingdom: individuals pay tax on a year ending 5 April.
- United States: individuals may (but rarely do) elect any tax year, subject to IRS approval.
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.
Read more about this topic: Fiscal Year
Famous quotes containing the words tax and/or year:
“As a Tax-Paying Citizen of the United States I am entitled to a voice in Governmental affairs.... Having paid this unlawful Tax under written Protest for forty years, I am entitled to receive from the Treasury of “Uncle Sam” the full amount of both Principal and Interest.”
—Susan Pecker Fowler (1823–1911)
“Even an attorney of moderate talent can postpone doomsday year after year, for the system of appeals that pervades American jurisprudence amounts to a legalistic wheel of fortune, a game of chance, somewhat fixed in the favor of the criminal, that the participants play interminably.”
—Truman Capote (1924–1984)