A fiscal year is a one-year period that companies and governments use for financial planning and budgeting. Fiscal years are most commonly used by entities that depend on a cycle that doesn’t correspond to the calendar year.
For example, the U.S. government’s fiscal year starts on Oct. 1 and ends on Sep. 30. It is structured this way so that the government can collect taxes, accept funding requests from its agencies, create a budget proposal, and route the proposed budget through the appropriate channels to Congress for approval.
