Hong Kong Company Year-End: 31 March vs 31 December

You incorporated in June, you sold a bit, ignored the books, and in November, someone says, we need accounts to 31st March. You think, we haven't even been alive for a year. Here's what happened. That date was chosen when the company was formed. You just weren't in the meeting. Your year end was set at incorporation, and most founders meet it at audit. In the next few minutes, what that date changes, what it doesn't, how to pick between the two usual choices, and whether it's too late if you already hate yours. Every Hong Kong company has a year end. The law calls it the accounting reference date, and I'll use that term once so it's on the record.

Under section 369 of the company's ordinance, chapter 622, the directors set it, and it must fall within 18 months of incorporation. If nobody sets one, the default is the last day of the month of your first anniversary, for a June company, 30th June. In practice, the date is usually set at formation, in the incorporation paperwork. The two most common choices across Hong Kong are 31st March and 31st December, and it's easy to sign without noticing. So, did someone already pick your year end? Almost certainly yes. Is 31st March the legal requirement? No, it's a common choice, not the law. And a 15-second correction. Hong Kong's government runs its fiscal year 1st April to 31st March.

That has nothing to do with your company's date. Yours can be anything. Your first accounts period starts on your incorporation date, not 1st January, and ends on that year end, which is why accounts to March feels wrong for a June company. Your first period isn't 12 months, it's whatever the gap is, shorter or longer, capped at 18 months from incorporation. That's normal and expected. It also explains the timing shock. Your first profits tax return arrives roughly 18 months after incorporation regardless. Our first tax return video covers that envelope. So the year end you didn't know about quietly decides how ready you are when it lands. Same Shopify business.

Two founders, both incorporated on the 10th of June. Founder A's provider set 31st March. First accounts, 10th June to 31st March, about 9 and a half months. Every year after, the close lands in the March rush. Auditors are at their busiest because half of Hong Kong closes the same day. The tax timetable is the most generous of any year end. With a tax representative, the return can run to mid-November, which feels like a gift until April becomes a pileup of everyone's deadlines at once. Founder B chose 31st December because the US parent and the Stripe reports already closed then. First accounts, 10th June to 31st December, a short 6 and a half month year.

After that, one close serves the group and Hong Kong. The auditor works in January and February when they're less swamped and the tax timetable is tighter than March's, around mid-August with a representative. Same company, different date, different year one pain. And that's all the IRD's N, D, and M codes are, by the way. Labels for how your tax deadline moves after the year end you picked. Nothing more to learn here. One sentence founders get wrong constantly. Your year end moves two things, the audit, the accounts are made up to that date, and the profits tax return timetable that follows it. It does not move the NAR1 annual return, which runs off your incorporation anniversary.

It does not move the business registration certificate, which runs off the certificate's own expiry. Year end, NAR1, BRC, three clocks, and this video is only about the first. And the year end changes only timing. It creates no audit exemption, no offshore status, and no bookkeeping holiday. If you're choosing or re-choosing four lines. Do you have a parent company or a marketplace pack that already closes on a date? Use that date. One close beats two. No parent, you live overseas, and you want maximum time after year end before the tax deadline, 31st March. No parent, and you already think in calendar years, 31st December.

Might close the company within a year, don't overthink it, either is fine. Don't invent a clever fourth date unless a group already closes on it. Three honest answers. If your first year end hasn't passed yet, you can usually still set it properly. Tell your secretary now. If you've already closed and filed once, you can still change it by director's resolution under section 371 of the company's ordinance, chapter 622. But it's no longer a free default. The new period can't exceed 18 months, and if you're extending, you generally can't do it again within five years unless you're aligning with a parent or the members approve. Private companies file nothing at the company's registry for this.

The Inland Revenue Department simply sees the new date in your next accounts. And if the auditor is already asking for this year's file, you finish this year on the current date. You decide the next one. Changing is paperwork. Not always easy, but never a trap. The facts in 20 seconds. Your year end was set at incorporation, usually by your provider, within 18 months, under section 369 of the company's ordinance, chapter 622. 31st March is common, not compulsory. Your first period runs from incorporation and can be short or long. Year end moves the audit and the tax return. It never moves the NAR1 or the BRC. Match a parent if you have one.

Otherwise, March for time, December for calendar thinking. Changing later is a director's resolution. Possible, not casual. Tell your company secretary the year end at setup, not at audit. At Captime Corporate Management Limited, a licensed TCSP, license number TC010212, we set the date with you at incorporation and keep your audit and tax calendar on it from day one. hk or use the link in the description. No credit card, no obligation. Thank you for watching. If this helped, give it a like and subscribe to Accurate, hype-free guides to running a Hong Kong company. See you in the next video.