Taxes in Finland are levied by government and municipalities. Government imposes such taxes as national income tax, wealth tax, value added tax, excise taxes, stamp duties and inheritance and gift taxes. Municipal governments impose municipal income tax and real estate tax.


The principal direct taxes are national income tax (valtionvero), municipal income tax (kunnallisvero) and net wealth tax (varallisuusvero).

National income tax at a flat rate of 28% is imposed on income earned by corporations and on capital income received by individuals. Income received by corporations and capital income received by individuals are not subject to municipal taxation or church tax. Corporations are not subject to net wealth taxation. The taxation of companies is based on the results reported in their annual statutory accounts, with certain adjustments for tax purposes.

National income tax at progressive rates is levied on earned income of individuals. This income is also subject to church tax (1-2%) and municipal income tax (15-20 %) at flat rates.


In addition to income taxes, there are inheritance and gift tax, withholding tax and stamp duties. Indirect taxes include value-added tax (arvonlis%vero), generally at a rate of 22%, and excise taxes (valmisteverot).


Advance rulings are available from the Central Board of Taxation and from the 11 county tax bureaus. A ruling is binding only on the specific transaction for which it was determined and only for the taxpayer who applied for it. It is not effective for other taxpayers with similar transactions.


For companies the tax year consists of the financial period (or periods) that ends during a calendar year. Companies must file their tax returns within 4 months from the end of their financial period.

For individuals the calendar year is the tax year. In general, they must file a tax return by 31 January of the following year. Individuals with professional income, however, have until 31 March to file their return. Individuals who have business income and whose financial period ends between 1 January and 1 October must file their tax returns by 31 January of the following year. If their financial period ends between 2 October and 31 December, the due date is 31 March of the following year. Non-residents are not required to file a return if their income has been subject to a final withholding tax.

The local tax bureau can extend the time to file for all taxpayers. The tax return must be filed with the tax bureau of the municipality in which the taxpayer resides. Employers withhold taxes on employees' wages plus the value of fringe benefits. The amount to be withheld is calculated based on a tax card issued annually to the employee by the taxation authorities. If the employee does not present the employer with a tax card, tax is withheld at a 60% rate. Amounts withheld, together with social security taxes, are paid to the authorities in the following month.

Self-employed individuals as well as limited companies and partnerships normally pay tax in 11 advance instalments based on an estimated assessment issued by the local tax office. Penalty interest of 1% a month is levied on overdue payments of advance tax. The taxpayer also has to pay a penalty interest of 0.5% a month for the first six months that a payment is late.

The final tax assessment for the tax year is determined based on the tax return. The Ministry of Finance decides annually when these assessments have been finalised. They are normally finished in October of the year following the tax year. At that time taxpayers receive a final tax bill showing the total amount of income tax liability. If the preliminary tax paid exceeds the final assessment, the difference is refunded in December. If the difference is an amount due, it must normally be paid in one instalment in December. If the advance instalments during the financial year has not been sufficient for the final taxes a special interest of 8 % has to paid for the missing tax from the date of filing the tax return to the final assessment. in case of tax refund the government pays an 4 % interest. The interest varies year by year because it is based on the market interest.


A taxpayer may appeal an assessment to a local board and the time for appeal is five years from the beginning of the calendar year after the year of assessment. A further appeal to the county is possible also court within five years from the beginning of the calendar year after the year of assessment. A further appeal to the Supreme Administrative Court is possible if it is made within 60 days after the taxpayer has received the decision from the county court and if the permission to appeal is granted.


The tax authorities have the right to examine a company's books and records and to request additional information. Audits may be conducted on the taxpayer's premises or elsewhere. An additional amount of income tax may be assessed as a result of a tax audit if the additional assessment is made within five years from the end of the calendar year in which the final assessment was originally made.

Large companies are audited regularly, usually every five years. Small and medium-size companies, however, are not audited regularly because of limited resources available to the tax authorities.

The content of this article is intended to provide a general information on the subject matter. It is therefore not a substitute for specialist advice.