Non-profit organisations can apply for tax relief for their taxable income. As a result, the organisation can be fully or partly exempted from income tax. See requirements and application instructions for a tax relief.
Activities of non-profit organisations often consist of
Associations and foundations must itemise the income and expenses of these functions in accounting and on their tax return.
Tax-exempt income for non-profit organisations includes
In addition, the following income is tax-exempt subject to certain conditions:
The following income is also tax-exempt if the income is obtained to finance non-profit activities and the activities do not meet the characteristics of business activities.
Food service and sales income received from events organised by an association or foundation or in conjunction with an association’s or foundation’s event. The income must come from lotteries, sales events, sports competitions, dance or other recreational events, or other comparable activities organised by an association or foundation.
Examples of tax-exempt income:
Note: If an association repeatedly provides catering services at events organised by others, these activities are usually regarded as business activities. Providing catering services at a single event is not regarded as a business activity.
The collection of merchandise and related flea market sales, when the merchandise sold has been received as donations and has only been restored to a minor extent.
Leasing out a table at a flea market is not tax-exempt. It is a taxable business activity, because it is regarded as the provision of sales locations.
Income received from membership magazines, websites, yearbooks or, for example, seasonal publications that demonstrate activities.
It is characteristic to a membership magazine or other publication that
Income from the sale of sympathy and greeting cards and other badges, such as pins, chest badges and stickers, in the case of small-scale sales and when the buyer rather intends to support the activities than acquire the product for their personal use.
Example: A sports club sells, by means of volunteer work, their own pennants, pins and stickers by a total of EUR 15,000 during their anniversary year. The purchase price of a single pin and sticker is EUR 0.10 for the club, and the sales price is EUR 1.50. The purchase price of a single pennant is EUR 2, and the sales price is EUR 20. Sales are tax-exempt activities with the intention of supporting the club.
Income from products or services made during care or handicraft activities or for educational purposes at a hospital, prison, rehabilitation institute or other similar institute.
Income received from organising a bingo game.
Note: The taxability of activities and income is always assessed separately in conjunction with taxation. The assessment includes the type and scope of activities.
Non-profit organisations pay income tax on
Tax rates are
Organisations only need to pay income tax on profit from taxable activities, not on profit from all activities. Profit is calculated so that deductible expenses are deducted from taxable income. The Finnish Tax Administration takes allowable losses from previous years into account in calculating taxable income.