The fiscal year start date in the tax declaration system (HTKK) is a small piece of information, but it influences the entire logic of the tax period, settlement deadlines, and cash flow pressure for businesses. In reality, many accountants and managers still confuse the establishment date, calendar year, and fiscal year, leading to incorrect declaration periods, requiring adjustments to tax returns, or incurring unnecessary back taxes. This article analyzes the management nature behind the fiscal year start date in HTKK, helping leaders understand correctly, choose wisely, and proactively control tax and financial risks.
What is the start date of the fiscal year in the HTKK system according to Vietnamese tax regulations?
In the HTKK (Tax Declaration Support) system, start date of the fiscal year This is the timeframe that tax authorities use to determine the corporate income tax calculation cycle, prepare financial statements, and reconcile tax obligations. In essence, HTKK does not "create" the fiscal year itself, but inherit the fiscal year legally registered by the business.When businesses declare initial information or perform tax settlement, the Tax Declaration System (HTKK) will use this information as a basis to classify revenue, expenses, and taxes according to the correct period.
The key point for managers is: HTKK only reflects dataHowever, the responsibility for determining and maintaining consistency of the fiscal year rests with the business.
From a CFO's perspective, this is a data "key point." If the fiscal year is entered incorrectly or there is a lack of synchronization between the tax declaration system, accounting ledger, and ERP system, the entire reporting system will be inaccurate.
Real life example
A commercial enterprise registers its fiscal year to coincide with the calendar year (January 1st–December 31st). However, in actual operation:
- The December marketing service invoice will arrive in January of the following year.
- The accountant still recorded the expenses in January for "easier processing".
Result:
- HTKK records the expenses in the following year.
- The management team looked at the previous year's report and saw unusually high profits.
- The decision to distribute dividends and expand the business was made at the wrong time.
Here, The problem is not with the Tax Declaration System., which lies in the fact The timing of expense occurrence within the fiscal year is uncontrollable.Bizzi helps address this point by taking note. the actual time the invoice/expense is incurredEven when invoices arrive late, this helps CFOs proactively allocate funds to the correct financial period.
When does the fiscal year begin, and how does it differ from the calendar year?
According to the Accounting Law and the Corporate Income Tax Law, the start date of the fiscal year depends on the company's choice:
The most common fiscal year is the same as the calendar year, starting on January 1st and ending on December 31st. This is the default choice for most Vietnamese businesses due to its convenience for tax filing and reporting.
However, the law allows businesses to choose a fiscal year different from the calendar year (e.g., April 1st - March 31st) if there is a valid reason such as industry specifics, a foreign parent company, or a unique business cycle. In this case, registration with the tax authorities is mandatory and consistency must be maintained throughout the accounting period.
For business leaders, choosing a fiscal year is not just about compliance, it's a strategic decision:
- It affects how business results are viewed.
- Impact on the budget cycle
- Impact on how cash flow performance is measured.
Practical example: A manufacturing business has a peak season from September to February of the following year. If using the Gregorian calendar:
- The peak season was "split in two" across two fiscal years.
- The annual reports consistently show high costs but disproportionately low profits.
Meanwhile, if the business chooses a fiscal year from April 1st to March 31st:
- A complete production-sales cycle falls within the same year.
- CFOs can more easily analyze performance based on seasonality.
Regardless of the chosen fiscal year, Bizzi helps standardize invoice, expense, and accounts receivable data according to the selected period, preventing each department from interpreting the "year" differently.
Why does the HTKK system only allow selecting the first day of the quarter as the start date of the fiscal year?
For accountants, the fiscal year is "right or wrong." For leaders and CFOs, the fiscal year is decision-making frameworkIf the fiscal year milestone is incorrectly defined or poorly managed, businesses may face three major risks:
- Firstly, the financial statements do not accurately reflect the operational efficiency of each period. Revenue may be correctly recorded for tax purposes but may not match the internal management period.
- Secondly, there is a mismatch between budget and actual expenditure. Year-end expenses may be "shifted" to another period, distorting the evaluation of departmental performance.
- Thirdly, the risk of tax audits increases when the tax declaration system, accounting records, and management systems are inconsistent.
From this perspective, Bizzi helps CFOs control the “actual occurrence period” of expenses and invoices., ensuring that input data is always readily available for comparison with the Tax Declaration System and the end-of-period financial statements.
How should newly established businesses, founded in the middle of the year, declare the start date of their fiscal year on the HTKK system?
For newly established businesses, the start date of the fiscal year in the tax declaration system (HTKK) is often confusing because the first period may be shorter than 12 months.
Real life example
The business was licensed on August 15th:
- Choose a fiscal year that coincides with the calendar year.
- The first fiscal year lasted only 4.5 months.
During this phase, businesses typically encounter the following issues:
- Office setup costs
- Recruitment costs
- Experimental marketing costs
If not properly controlled:
- Expenses were underrecorded or recorded in the wrong period.
- The first year's report looked "artificially good," but the following year it bore the costs.
According to regulations, the first fiscal year begins on the date the business registration certificate is issued and ends on the last day of the chosen fiscal year. Businesses are allowed to combine periods if the total duration does not exceed 15 months.
Here, the challenge lies not in the regulations but in managing the data generated in the initial period. Initial costs, trial invoices, and setup costs, if not properly categorized for the correct period, can easily distort reports.
Bizzi supports new businesses by digitizing all invoices and expenses from the outset, clearly marking the time of occurrence and purpose of the expenditure, making it easy for CFOs to monitor even when the financial period is not a full year.
How does the choice of fiscal year affect cash flow and accounting pressure?
From a CFO's perspective, the fiscal year is not just a timeline, but a convergence point of risk:
- Debt collection (AR)
- Applicant Payment (AP)
- Pay corporate income tax
- Closing the books and auditing
If the fiscal year ends during the peak business season, businesses may face double cash flow pressure: having to collect payments while also paying taxes and expenses. Therefore, the question "when does the fiscal year begin?" needs to be considered within the context of the business and monetary cycles, not just compliance.
Here, mature businesses typically separate:
- Data for HTKK
- Data business cash flow management in real time
Bizzi ARM helps businesses track accounts receivable by age, automatically sends reminders before closing dates, and enables CFOs to proactively manage cash flow before settlement, rather than dealing with the consequences afterward.
Frequently Asked Questions about the start date of the fiscal year in HTKK
Is it possible to choose a fiscal year different from the calendar year?
Yes, if the legal requirements are met and the tax authorities are notified, but HTKK only accepts the first day of the quarter.
Do I need to notify the tax authorities if I change my fiscal year?
Yes. Changes to the accounting period must be notified and applied consistently.
What should I do if the HTKK software reports an error preventing me from saving the start date of the fiscal year?
This is often due to selecting the wrong date range or because the previous period's data hasn't been properly locked.
When does the first fiscal year, which lasts 15 months, come into effect?
Applicable to newly established businesses or those changing their fiscal year.
Does the start date of the fiscal year affect the deadline for submitting financial statements?
Yes. The deadline for submitting financial statements and settlements depends on the end date of the fiscal year.
Is it necessary to synchronize the fiscal year between HTKK and ERP?
It's important to distinguish: synchronization is for compliance, but internal governance can be more flexible.
How should FDI enterprises with different fiscal years than their parent companies be handled?
Typically, two systems must be maintained in parallel: one for corporate governance, and one for the Vietnam Tax Declaration System (HTKK Vietnam).
Will I be fined for incorrectly declaring the fiscal year on the HTKK system?
This may result in requests for adjustments, back taxes, and compliance risks.
Conclusion: Understanding the correct "fiscal year start date in HTKK" is crucial for proactive management, not just accurate declaration.
Ultimately, understanding the start date of the fiscal year in the tax declaration system (HTKK) is no longer just a technical question for accountants, but rather the intersection between tax compliance and financial management. By clearly understanding when the fiscal year begins, businesses can:
- File your taxes on time.
- Reduce the risk of adjustments and retroactive collection.
- Proactively manage cash flow before settlement.
In practice, efficient businesses don't let the tax declaration system dictate how they view their finances. They use the tax declaration system for compliance, but use Bizzi to monitor invoices, expenses, accounts payable, and cash flow in real time – in sync with their business operations. That's the difference between following procedures and managing finances proactively.
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