What is a U.S. tax year for expats, and does it match my foreign country’s tax year?

The U.S. tax year is the calendar year, January 1 to December 31, for individual filers. Many countries use different tax years (the UK runs from April 6 to April 5, Australia from July 1 to June 30, Japan from April 1 to March 31), which can create timing challenges when claiming Foreign Tax Credits on income taxed at different periods in each country.

Common foreign tax years vs U.S. calendar year:

How expats reconcile the difference:

• Income: report on the U.S. calendar-year basis, converting each transaction to USD at the appropriate rate
• Foreign tax paid: use the paid method (credit in the year paid) or the accrued method (credit in the year the foreign tax liability accrues), and elect consistently
• Treaty resourcing: Some treaties allow resourcing provisions to align FTC timing with U.S. tax on the same income

Timing traps to avoid:

• Claiming the FTC for taxes that have not yet been finalized or paid
• Double-claiming an estimated tax and later the true-up
• Missing a credit because the foreign tax was paid in a later U.S. year (carry forward up to 10 years, carry back 1 year)

For more on the timing of the FTC, see our Foreign Tax Credit Guide. For a country-by-country breakdown of foreign tax year dates, see our Tax Deadlines by Country.