A Vietnamese subsidiary often has to change its fiscal year to match the group’s — most commonly moving from the calendar year to a year ending 31 March or 30 June. The change looks like an internal accounting decision, but for tax it creates a “transitional period” shorter than 12 months that must be finalised separately, and not every tax follows the new fiscal year. This article sets out the tax procedures for changing the fiscal year, on the current framework: CIT Law 67/2025/QH15 on tax periods and the Law on Tax Administration 108/2025/QH15 (replacing Law 38/2019/QH14 from 1 July 2026) on notification and finalisation procedures.
1. The CIT period: calendar year or a registered fiscal year
The corporate income tax period is determined by the calendar year, or by the enterprise’s fiscal year where the enterprise applies a non-calendar fiscal year and has notified the tax authority. The consequence: a company wanting to finalise CIT on the new fiscal year must complete the notification of the tax-period change before the new period starts running; until notified, the tax period remains the calendar year even if the accounting books have already switched. On conversion, the stretch from the start of the old tax year to the start of the new fiscal year forms a transitional tax period: it may be shorter than 12 months, needs its own finalisation return, and the rules on loss carry-forward and incentives apply per independent tax period — a short transitional period still counts as one period for tracking the loss carry-forward deadline, a point routinely missed in planning.
2. Notification procedure and tax registration changes
The enterprise notifies the change of fiscal year and tax period to its direct tax authority under the tax-registration information change procedure, synchronised with the change in its charter and business registration where the charter records the fiscal year. The notification timing decides when the new tax period takes effect: notifying after the transitional period has begun may lead the authority to refuse retroactive application, forcing calendar-year finalisation for the elapsed part. Periodic obligations during the transition — quarterly provisional CIT payments, monthly or quarterly VAT returns — keep running on their own calendars and do not pause for the transitional period; the company needs a dedicated transition compliance calendar for the change year so no filing period is missed in either system.
3. Taxes that do not follow the fiscal year
Three things do not change when the fiscal year changes. First, personal income tax is always computed on the calendar year: PIT withholding and finalisation for employees do not shift with the company’s fiscal year, including for foreign experts finalising by residence period. Second, VAT is declared by calendar month or quarter as usual. Third, loss carry-forward deadlines and incentive conditions are counted by CIT tax period — when a short transitional period appears, the number of periods consumed for loss carry-forward runs faster than real years, and incentive periods are likewise “burned” by period rather than by full 12 months. This is the hidden price of changing the fiscal year that group accounting teams often omit when proposing the change for consolidation reasons.
4. What to do before and after the change
Before the change: review the short transitional period’s impact on loss carry-forward deadlines and the incentive period in course; pick the new fiscal year’s start date so the transitional period does not cut across a large in-progress transaction for tax purposes; and align the effective date across the charter, business registration and tax notification. After the change: prepare and file a separate finalisation for the transitional period on time as an independent tax period; adjust the quarterly provisional payment calendar to the new period; and inform auditors and stakeholders that the first year on the new calendar carries two finalisations (the transitional period and the first full period). Done completely, a fiscal-year change is a controlled administrative change; skip a step and the problem typically surfaces at the first finalisation on the new calendar, when the timeline can no longer be repaired.
This article has been quality-reviewed by the FLAW AI Legal Council