Financial Year End in Hong Kong: How to Choose It, and How to Change It
Every Hong Kong company has a financial year end: the date its accounts are made up to each year. It decides when the books are closed, when the audit happens, when the accounts go to shareholders and when the profits tax return is due. Most owners never consciously choose it. Here's how it's set, what the common choices mean, and how to change it.
How a new company's year end is set
Under the Companies Ordinance the year end is the company's accounting reference date:
- The first period runs from incorporation to the first accounting reference date (section 368).
- The directors can choose that date, as long as it falls within 18 months of incorporation (section 369).
- If they don't choose, it's the last day of the month in which the first anniversary of incorporation falls. A company incorporated on 15 May 2026 would, by default, have its first year end on 31 May 2027.
- After that, each period is 12 months, and the financial year may end on the accounting reference date or up to 7 days either side of it, if the directors decide (sections 367 and 368).
The common choices
| Year end | IRD code | Why companies choose it |
|---|---|---|
| 31 March | M | Matches Hong Kong's year of assessment (1 April to 31 March); the latest profits tax return deadline under the block extension |
| 31 December | D | The calendar year; often matches a parent company or overseas group, and banks and investors |
| Another month end | N (April to November) | Fits a seasonal business, for example a year end after the busy season, when stock is low |
The IRD's year of assessment runs from 1 April to 31 March, and its block extension scheme groups companies by their year end. The code decides when the return is due (see profits tax return deadlines). A 31 March year end gives the longest time to file after the year end.
How to choose
- Match your group or investors, if you have them. Consolidating companies with different year ends is extra work.
- Avoid your busiest season. Closing the books and counting stock in the middle of peak trading is hard work (see inventory and stocktake).
- Think about the auditor. Hong Kong audits tend to cluster around 31 March and 31 December year ends; another month end can mean an easier timetable.
- Think about the deadlines that follow. Accounts must go to shareholders within nine months of the year end for a private company (section 431), and any AGM must be held within nine months (section 610) (see the year-end checklist).
Changing the year end
Section 371 lets the directors specify a new accounting reference date by resolution, either for the current period or for the previous one, shortening or extending it. The limits:
- A period can't be extended to more than 18 months.
- A period generally can't be extended again if an earlier one was extended within the previous five years (there are exceptions).
- The previous period can't be changed once the deadline for laying or sending its accounts has passed.
- Public companies and companies limited by guarantee must notify the Companies Registry within 15 days; for a private company limited by shares, the directors' resolution is the record.
The tax side of a change
Profits tax is charged on the accounts made up to the company's usual date. When a company doesn't make up accounts to the corresponding day in the following year, section 18E of the Inland Revenue Ordinance lets the Commissioner decide the basis on which that year's profits are computed, and recompute the previous year's. In practice: agree the change with your tax representative before the resolution, and tell the IRD when you file.
How Certanta helps
- Books kept to your year end, closed monthly, so the year end is the twelfth close, not a project.
- Every deadline that follows from it in your portal: the profits tax return under the IRD's dates for your code, and the accounts due to shareholders.
- A short or long first period handled, with the statements and the tax computation for whatever period the accounts cover.
Frequently asked questions
What is the financial year end of a Hong Kong company?
The date its accounts are made up to each year, its accounting reference date under the Companies Ordinance. The financial year ends on that date or, if the directors decide, up to seven days either side of it.
What is the default year end for a new Hong Kong company?
If the directors do not specify a date, the first accounting reference date is the last day of the month in which the first anniversary of incorporation falls (Companies Ordinance, section 369).
How long can a company's first financial period be?
The directors can choose a first accounting reference date within 18 months of incorporation, so the first period can be up to about 18 months.
Is 31 March or 31 December better?
31 March matches Hong Kong's year of assessment and gives the latest profits tax return deadline under the block extension; 31 December suits companies that report on the calendar year or belong to an overseas group. Neither is right for every company.
How do I change my company's financial year end?
By a directors' resolution under section 371 of the Companies Ordinance specifying a new accounting reference date and whether the current or previous period is shortened or extended. A period cannot be extended beyond 18 months, and extensions are generally limited to one in five years.
Does changing the year end affect profits tax?
Yes. Under section 18E of the Inland Revenue Ordinance, when accounts are not made up to the corresponding day, the Commissioner decides the basis on which the profits for the year are computed, and the previous year may be recomputed. Agree the change with your tax representative first.
Every deadline that follows from your year end, tracked
Certanta keeps your books to your year end and lists the deadlines that follow from it, the profits tax return and the accounts for shareholders, in your portal.
Open the demo See pricingThis article summarises the Companies Ordinance (Cap. 622) and the Inland Revenue Ordinance (Cap. 112) as published on e-Legislation on 29 October 2026. It is general information, not legal or tax advice. Before choosing or changing a year end, talk to your company secretary and tax representative.