A pay stub can be a confusing piece of paper. It can look like a mishmashed table of numbers and words. On most pay stubs, there will be a figure showing your year-to-date (YTD) earnings. If you work for a company that uses a fiscal year instead of a calendar year, that means its accounting period ends on a date different than Dec. 31, and the number appearing under that column shows how much money you have made during the period that starts on the company's fiscal year beginning date.
A fiscal year-end is a 12-month reporting period that ends on a date other than the last day of a calendar year, which is December 31. It is not unusual to have businesses report a fiscal year-end. Fiscal year-to-date will show only money earned during the fiscal year. If your company's fiscal year begins on July 1 and you look at a paycheck for October, the Fiscal YTD column will show the money earned between July 1 and October, not January to October.
A calendar runs from the first day of the year, Jan. 1, until the last day of the year, Dec. 31. The most common use of a calendar year-end is for personal income tax. When individuals file their income taxes, they pay on the amount of income earned from Jan.1 to Dec. 31. This is why a W-2 form will state a person's earnings during this time period, instead of what is noted on a fiscal year-to-date pay stub.
A company may choose a fiscal year reporting period rather than a calendar year reporting period because it may be too hectic and to compile both business and personal taxes. Another reason may be that a company will want to close its books following an important event that occurs at the same time every year, such as a contract renewal. Businesses may choose to have a fiscal reporting year that coincides with the end of a quarter simply out of ease because information is already being gathered for quarterly reports.
Government Fiscal Year
Many governments operate on a fiscal reporting calendar. In the United States, the fiscal year begins Oct. 1, ending Sept. 30 the following year. For example, the 2011 budget covers government spending from Oct. 1, 2010, to Sept. 20, 2011. In Canada, the fiscal year runs from April 1 to March 31. In the United Kingdom, the fiscal year runs from April 6 to April 5.
- Photo Credit old calendar image by Allyson Ricketts from Fotolia.com
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