Tax-exempt use of a vehicle for demonstration purposes
Demonstration use means the demonstration or test driving of a vehicle with the intent to sell. The use of a vehicle for demonstration purposes can be exempt from tax in the business operations of a company that imports, manufactures or sells vehicles.
Demonstration use is tax-exempt only if the vehicle has been granted a transfer permit as described in the act on vehicles (Ajoneuvolaki 1281/2003) or if the vehicle is registered in another EEA country.
A vehicle can be in tax-exempt demonstration use for 9 months following the start date of use. Tax-exempt demonstration use can last no more than 3 days per customer.
A vehicle that has previously been in tax-exempt demonstration use in Finland and whose demonstration use has ended cannot be taken into demonstration use in Finland exempt from car tax again. This limitation applies even if the period of demonstration use was shorter than the maximum period of 9 months.
If the requirements for tax-exempt use are not met, the vehicle is considered to have been taken into taxable use. The person who started using the vehicle must submit a declaration of use and file a car tax return. Read more about filing the tax return (Finnish and Swedish only, link to Finnish).
File the declaration before tax-exempt demonstration use starts
The party that imports the vehicle or takes it into use must submit a declaration of tax-exempt use before the vehicle is used. Read more about tax-exempt vehicle use (Finnish and Swedish only, link to Finnish).
The Tax Administration will confirm your declaration, but that does not mean that the Tax Administration has checked or confirmed that the requirements for tax-exempt use are met. Please remember to check beforehand whether or not you have the right to use the vehicle exempt from tax. If you do not, your use of the vehicle is subject to tax.
You will receive a letter in your MyTax mailbox as soon as your declaration has been confirmed. You can print out the letter in MyTax. You will also receive the letter by post to your home address, unless you have activated Suomi.fi messages and chosen not to receive paper mail.
- If necessary, you can make changes to the declaration even after it has been confirmed.
Always keep the letter of confirmation in the vehicle and present it to the police or Customs if requested.
Vehicle registration in an EEA country or transfer permit
A vehicle in tax-exempt demonstration use must either be registered in an EEA country or have a Finnish transfer permit. Read more about the transfer permit (Traficom).
You can get a transfer permit for the vehicle at an inspection station. In order to get the permit, you must present a declaration of tax-exempt demonstration use confirmed by the Tax Administration. If you have filed the declaration of demonstration use via the Vero API, you can print out the Tax Administration’s confirmation message.
Keep a driver’s log on demonstration use
Companies must keep a driver’s log on paper or digitally. Every time the vehicle is used, the following information must be recorded in the log:
- the start and end time of the drive
- the odometer reading at the start and end of the drive
- purpose of the trip
Record all use of the vehicle in the driver’s log.
Save the driver’s log for at least 6 years from the start of the year following the start of the tax-exempt use. Present the log to the Tax Administration if requested. Make sure you save the log in such a way that the original records remain verifiable. If you do not keep a driver’s log, the Tax Administration may impose a negligence penalty.
If you cannot prove that the requirements for tax-exempt use were met, the Tax Administration may impose car tax and late-payment interest. In addition, you may have to pay a punitive tax increase. Read more about the consequences for late filing.