Insurance Premium Taxation
Obligation to pay insurance premium taxes in Finland
Insurance business running companies and insurance providers (i.e. insurance companies), both Finnish and foreign companies located in the European Economic Area (EEA), are usually obliged to report and to pay insurance premium taxes in Finland. Insurance premium tax is a state tax that is obliged to report and to pay if the assets, covered by insurance contracts, are situated in Finland or insurance contracts are covering Finnish operations or other benefits in Finland.
In some situations, natural or legal persons taking insurances may be obliged to report and to pay Finnish insurance premium tax. This applies when the receivers of the insurance payments, which payments are based on the insurance contracts that are objects of the Finnish insurance premium tax, are insurance providers having no presentative or branches in Finland. In practice, this occurs when the insurance provider is located outside of the EEA.
Objects of the Finnish insurance premium taxation
Objects of the Finnish insurance premium taxation are mainly property, suspension and liability insurances.
Act on Taxation of Certain Insurance Premiums (Act on the Tax on Insurance Premiums; 664/1966) specifies insurance contracts that are not objects of the Finnish insurance premium taxation.
Insurance tax rate
Finnish insurance premium tax rate is 24 %.
The rate of insurance premium tax is 24%. Its base is the accumulated or paid-in insurance premiums (sections 3 and 4 of the act on the tax on insurance premiums (Vakuutusmaksuverolaki 664/1966). In fire insurance, the fire protection fee of 3% must be included in the base for the tax.
Registration, reports and payments
1. STEP: Registration
Registration notifications (to start, to change or to terminate registration) are needed if the obligation to report and to pay Finnish insurance premium tax exists or there will be some changes in status. Notifications are made by using the business information system forms Y1-Y6. Please see more on Business Information System.
The notifications are free of charge if only the Tax Administration is notified on the notification forms. Other than the Tax Administration notifications submitted to the Trade Register are usually subject to a fee. The forms should be filled in by using Finnish or Swedish.
2. STEP: Apply for a Katso ID
To use the official Finnish Electronic filing services, e.g. MyTax, you need a Katso ID. Please see more on Katso service website (English).
A Katso ID can be set up for Finnish or for foreign-registered company's representatives, who may be either Finnish or foreign citizens.
3. STEP: Reporting and paying on MyTax
Insurance premium tax is so called self-assessed tax that is reported monthly by filling a self-assessed tax return on MyTax online service. The tax is paid on online service as the other self-assessed taxes.
File and pay the insurance-premium tax by the 12th of the month after the end of the calendar month (in other words, if a payment relates to June, file and pay it by 12 July).
Please see more on MyTax.
The service is available in English.
4. STEP: Changes or Termination of Registration
Please see step 1.
In case you have any questions on Finnish Insurance Premium Tax, please send your message to vakuutusmaksuvero(a)vero.fi.