How do I choose my company's financial year end?
You choose it, usually when you incorporate, and it is not fixed to 31 December. Pick a date that suits your business cycle and your accountant's workload; every later deadline for financial statements and filings is counted from it.
A company's financial year end (FYE) is set by its directors. There is no rule that it must be 31 December.
Things to weigh:
- Business cycle: many owners pick a quiet period so stock-takes and closing are easier, such as just after a peak season
- Group alignment: a subsidiary often follows its foreign parent's year end to ease consolidation
- Workload and fees: accountants are busiest around 31 December and March, so an off-peak date can mean faster turnaround
- Tax timing: the FYE decides the basis period for tax, and the tax return deadline follows from it (the timeline is in the tax section of this knowledge base)
- Simplicity: a month end is far easier than mid-month
What the FYE drives:
- Financial statements must be circulated within six months for a private company
- Statutory lodgement with SSM follows within 30 days of circulation
- Tax filing, instalment and audit planning all key off the same date
Choose carefully. Changing it later can push the circulation and lodgement dates out, which needs SSM's agreement (see the question on changing the year end), and a subsidiary's year end generally has to line up with that of its Malaysian holding company (section 247).
Legal basis
- Companies Act 2016, s.248(1)
- Companies Act 2016, s.247
- Companies Act 2016, s.258
Sources
Applies to 2026 · Last reviewed 29 October 2026
General information for business owners, not legal, tax or professional advice. Rules change, so check the sources or ask a licensed professional before you act.
Related questions
- Is a Sdn Bhd legally required to keep accounting records?Yes. Section 245 of the Companies Act 2016 requires every company, including its directors and managers, to keep accounting and other records that explain its transactions and financial position. This applies even to a new, dormant or loss-making company.
- How long must a Malaysian company keep its accounting records?A company must keep accounting records for seven years after the transactions they record were completed. For tax, documents must be kept for seven years from the end of the relevant year of assessment. Use whichever period ends later.
- How soon must transactions be recorded in the books?Under section 245 of the Companies Act 2016, entries must be made in the accounting records within 60 days after the transaction is completed. Leaving the books for a full year-end rush is therefore not compliant.
- Do sole proprietors and partnerships in Malaysia need to keep books?Yes. The Income Tax Act requires anyone with business income to keep sufficient records to work out their income. LHDN has a separate public ruling for businesses that are not companies. The Companies Act rules apply only to companies.
- Can a company change its financial year end, and how?Yes. The Companies Act 2016 does not state a maximum length for a financial year or how often it can change. But a new year end that pushes the circulation or lodgement date later needs an extension of time from SSM, applied for before the original deadline. A subsidiary's year end must also stay in line with its Malaysian holding company's.