As a general rule taxes are paid to the country of employment. You can find more information on payment and exceptions on the page When do you need to pay tax in Finland? Also check taxation of pensions in Finland, taxation of students in Finland and taxation of cross-border workers in Finland. More information on taxation of au pairs is available in the Tax Administration guide Au pairs coming to Finland from other countries.
Information on taxes on owning, buying and selling a home in Finland is given on the page Living in Finland.
Taxation of earned income
In Finland the earned income of resident taxpayers is taxed progressively, i.e. with higher income the tax rate increases. Taxable earned income includes wages and salaries, pensions and benefits or payments received in lieu of such income.
You can find annual tax percentages and other information on taxation on the Nordic tax portal. You can use the Finnish Tax Administration’s tax percentage calculator to check your own tax percentage. The calculator cannot take into account foreign income.
Tax on earned income is paid to the state and the municipality. Members of the Lutheran or Orthodox church also pay church tax. If a person is covered by Finnish health insurance, health insurance daily allowance contributions, unemployment insurance contributions and pension insurance contributions are levied on earned income. Daily allowance contributions are levied if the income exceeds a certain minimum level. Resident taxpayers are also charged Public Broadcasting Tax. More information on the Public Broadcasting Tax is given on the Finnish Tax Administration’s website.
Non-resident taxpayers normally pay tax at source on their earned income. Tax at source is always 35% (15% for sportsmen and athletes and performing artists), and a basic deduction is available of 510 euros a month or 17 euros a day.
Non-resident taxpayers can apply for progressive taxation instead of tax at source, so that the tax percentage is affected by total annual earnings and expenses. With progressive taxation you are entitled for example to deductions for journeys between your home and workplace and deductions for the production of income.
Progressive taxation is applied for on form 6148. On the form you must declare your estimated annual earnings in Finland and elsewhere in the world. So earned income in your country of residence as well as deductions applicable to this income must also be declared. Finland only taxes your income in Finland, but taxable income in your country of residence increase the taxes on your income in Finland. Persons applying for progressive taxation must also check and correct the tax return posted at the end of the year.
Taxation of capital income
The tax percentage on capital income is 30% up to 30,000 euros and after that 34%. Capital income includes proceeds from property, profits from the disposal of property and other income that can be considered to accumulate wealth: for example interest income, dividend income from listed companies, rental income, profit shares, income from life insurance, capital income shares in forestry, income from land and capital gains. Expenses and sales losses may be deducted in taxation.
If a person is a tax resident in Finland, foreign income is taxable in Finland even if the assets are not transferred to Finland.
Inheritance tax must be paid on property received as an inheritance or a bequest, if at the time of death the deceased lived in Finland. More information on inheritance tax on the page Death of a family member in Finland and on the Finnish Tax Administration’s website.
Gift tax is paid on gifts and advancement of inheritance to the value of 5000 euros or more. More information and instructions for completing the declaration form in the Finnish Tax Administration’s guide to gift tax.
Various deductions may be made in taxation, such as the tax credit for household expenses, expenses for the production of income and travel expenses between home and workplace. Some deductions are made from income before tax is calculated, and some are deducted from taxes. More information is given on the Finnish Tax Administration’s website.
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