Instructions for completing the tax return – profit tax in the electricity and fossil fuel sectors
These instructions describe what information needs to be submitted on the tax return for the profit tax in the electricity and fossil fuel sectors.
The tax return must be filed by the following companies:
- In the electricity sector, the profit tax return must be filed by companies conducting business operations in the electricity sector whose net sales of electricity business amount to at least €500,000. The tax return must also be filed by tax-exempt electricity retailers.
- In the fossil fuel sector, the profit tax return must be filed by companies conducting operations in the fossil fuel sector for whom more than 75% of their turnover consists of one or more of the following operations:
- production of crude oil or natural gas
- manufacture of refined oil products from crude oil
- manufacture of coal products (company operating in the fossil fuel sector).
As an attachment to this tax return, submit the disaggregated financial statements for electricity business (unless you are a tax-exempt electricity retailer).
Basic details
Taxpayer details
- Name
- Business ID or personal ID
- Accounting period
Company or organisation is an electricity retailer
Report here if the company’s business operations in the electricity sector consist of electricity retail as defined in § 3, paragraph 12 of the act on electricity markets (Sähkömarkkinalaki 2013/588) and the following conditions are met:
- The company does not produce electricity as defined in the act on electricity markets.
- The company is not a part of the same group as another company that produces electricity as defined in the act on electricity markets.
- The company or another company in the same group does not directly or indirectly own shares in a company engaged in electricity production where the ownership of shares in that company would give the right to acquire electricity at a lower price than the fair market value.
If all of these conditions are met, the company is exempt from the profit tax and does not need to fill in the rest of the tax return.
Account of profit and loss
Calculating the result of electricity business:
The first section of the tax return is for calculating the result of electricity business before losses from other group companies are taken into account, or for calculating the loss for the electricity business. This section involves the following stages:
- Report the profits of electricity business.
- Report the expenses for electricity business (including the specification of depreciation).
- After these, report the difference between the profits and expenses of electricity business.
- Report the non-deductible portion of interest related to electricity business if, in a later stage of the tax return concerning the adjustments of equity, you demand that separately determined shares are included in the adjusted equity.
- Report the required details on internal electricity business if profits from internal electricity business are included in the profits of electricity business. These details must be reported because the result of electricity business calculated in the tax return does not take the result of internal electricity business into account.
- The calculation result derived from the details above will be either the result of electricity business before losses from other group companies or the loss for electricity business.
- Finally, state whether you demand that the losses of other group companies’ electricity business are taken into account in the company’s tax assessment.
Profits of electricity business
Profits recorded in the accounts
Report here the profits of electricity business as recorded in the accounts in accordance with the profit and loss account of the disaggregated financial statements. Report all profits included in the profit and loss account, i.e. not just the net sales but also interest and financial income, group subsidies received, and any other income. Note that the decrease in depreciation difference is not reported in this section.
Group subsidies received
Report here the amount of intra-group subsidies received if they are included in the profit and loss account of the electricity business. These group subsidies are subtracted from the sum total of the profits of electricity business.
Profits from a permanent establishment abroad
Report here the profits from a permanent establishment abroad if they are included in the profit and loss account of the electricity business. These profits from a permanent establishment abroad are subtracted from the sum total of the profits of electricity business.
Other deductions from profits
Report here any tax-exempt profits that are included in the income tax return if they concern electricity business. These tax-exempt profits are not included in the sum total of the profits of electricity business.
Total profits of electricity business
Report here the total profits of electricity business. This amount is calculated by subtracting the amounts reported above – group subsidies received, profits from a permanent establishment abroad, and other deductions from profits – from the profits of electricity business according to the profit and loss account. MyTax calculates the amount automatically based on the information you have given.
Expenses for electricity business
Expenses other than depreciation of fixed assets recorded in the accounts
Report here all other expenses for electricity business recorded in the profit and loss account except for the depreciation of fixed assets. Formulate the amount from the company’s disaggregated profit and loss account for electricity business. Report all expenses included in the profit and loss account, i.e. including interest expenses, financial expenses, group subsidies paid out, and any other expenses.
Depreciation of fixed assets (including both movable and other fixed assets) will be taken into account in accordance with the act on profit tax (Laki sähköalan ja fossiilisten polttoaineiden alan väliaikaisista voittoveroista 363/2023) in the next section, “Specification of depreciation”. Planned depreciation or changes in depreciation difference included in the disaggregated profit and loss account for electricity business are not reported in this section.
Specification of depreciation
This specification is for determining the portion of the depreciation of movable fixed assets that is taken into account in the tax assessment of electricity business. Also report the portion of the depreciation of assets other than movable fixed assets that is taken into account in the tax assessment of electricity business. For movable fixed assets, include the increased depreciation on machinery and equipment.
Depreciation of movable fixed assets related to electricity business, according to the profit and loss account
Report here the depreciation of movable fixed assets related to electricity business as stated in the profit and loss account. Include both the planned depreciation of movable fixed assets deducted in the disaggregated profit and loss account as well as the change in depreciation difference.
Depreciation of movable fixed assets regarding all business, according to the profit and loss account
Report here the depreciation of movable fixed assets regarding all business as stated in the profit and loss account. Include both the planned depreciation and the change in depreciation difference.
Make sure that the amounts reported here are also included in the itemisations on Form 62 (planned depreciations).
Depreciation related to electricity business in proportion to all depreciation
Determine the ratio of depreciation related to electricity business in proportion to all depreciation. This figure will be referred to as depreciation ratio elsewehere in these instructions. Calculate the depreciation ratio by dividing the amount of depreciation related to electricity business reported above with the total amount of depreciation related to all business. Enter the figure as a decimal.
Include enough decimals so that the depreciation ratio can later be used to accurately calculate the portion of the declining-balance depreciation of movable fixed assets that is taken into account in the tax assessment of electricity business (see section below).
Regular tax assessment (act on business tax): declining-balance depreciation of movable fixed assets
Report here the declining-balance depreciation of movable fixed assets as defined in the act on business tax (Laki elinkeinotulon verottamisesta 360/1968).
Make sure that the amounts you enter here are also are itemised on Form 62 (normal depreciation of movable fixed assets permitted by tax laws as well as additional depreciation and tax-relief depreciation).
Declining-balance depreciation of movable fixed assets, portion taken into account in the tax assessment of electricity business
Determine the portion of the declining-balance depreciation of movable fixed assets that is taken into account in the tax assessment of electricity business. This figure is calculated by multiplying the declining-balance depreciation of movable fixed assets as defined in the act on business tax with the depreciation ratio determined above.
MyTax will calculate this figure automatically based on the information you have given. If you are filing on paper, copy this figure from the background calculations column to the tax calculation column.
Depreciation of other than movable fixed assets related to electricity business, according to the profit and loss account
Report here the depreciation of other than movable fixed assets related to electricity business as recorded in the disaggregated profit and loss account. Include both the planned depreciation and the change in depreciation difference.
Depreciation of assets other than movable fixed assets, portion taken into account in the tax assessment of electricity business
Report here the portion of the depreciation of assets other than movable fixed assets (according to the profit and loss account) that is taken into account in the profit tax assessment of electricity business in accordance with the act on business tax.
Group subsidies paid out
Report here the amount of intra-group subsidies paid out if they are included in the profit and loss account of the electricity business. These group subsidies are subtracted from the sum total of the expenses of electricity business.
Expenses of a permanent establishment abroad
Report here the expenses of a permanent establishment abroad if they are included in the profit and loss account of the electricity business. These expenses of a permanent establishment abroad are subtracted from the sum total of the expenses of electricity business.
Other deductions from expenses
Report here any non-deductible expenses that are included in the income tax return if they concern electricity business. These non-deductible expenses are not included in the sum total of the expenses of electricity business.
Check what non-deductible expenses have been reported in the income tax return. You can find these expenses by checking the non-deductible expenses in the tax return or by comparing the taxation column and the accounting column (i.e. by looking for entries where the value in the taxation column is smaller than the value in the accounting column).
Total expenses for electricity business
Report here the total amount of the expenses for electricity business. This amount is calculated by adding the amount of all other expenses for electricity business recorded in the profit and loss account (except for the depreciation of fixed assets) to the portion of the depreciation of other than movable fixed assets that is taken into account in the tax assessment of electricity business, and by subtracting from that sum the amounts of group subsidies paid out, the expenses of a permanent establishment abroad, and other deductions from expenses. MyTax calculates the amount automatically based on the information you have given.
Difference between the profits and expenses of electricity business
Calculate the difference between the profits and expenses of electricity business. In other words, subtract the total expenses for electricity business from the total profits of electricity business. MyTax calculates the amount automatically based on the information you have given. If you file on paper and the calculation result is negative, mark a minus sign in front of the figure.
Non-deductible portion of interest related to electricity business
Report here the non-deductible portion of interest related to electricity business. Fill in this field only if, in a later stage of the tax return concerning the adjustments of equity, you demand that separately determined shares are included in the adjusted equity. If you make this demand, the non-deductible portion of interest related to electricity business is calculated as follows: the acquisition cost of separately determined shares (as described in § 12, subsection 2 of the act on profit tax) according to the financial statements for electricity business concerning the year before the tax year (for the 2023 tax return this means the disaggregated financial statements for 2022, if the accounting period is the calendar year) is divided by the balance-sheet total of the taxpayer company’s disaggregated financial statements (§ 6, subsection 4 of the act on profit tax).
The figure entered in this section will later increase the amounts entered for “Result of all electricity business” (in the calculation of internal electricity business) and for “Result of electricity business before losses from other group companies” (or “Loss for electricity business”).
Specification of internal electricity business
Ratio of net cost to net sales in electricity business
This section is for calculating the portion attributable to internal electricity business from the overall result of electricity business. The figure calculated here will decrease the amount entered for “Result of electricity business before losses from other group companies”.
Net cost of the company’s own electricity purchases
Report here the net cost of the company’s own electricity purchases. The net cost of electricity purchases is comprised of the purchase price of electricity as well as the income and losses from hedging electricity purchases as indicated in the accounts. Report here only the net costs of electricity purchases that are not included in the disaggregated profit and loss account for electricity business, i.e. net costs of electricity purchases that are related to the company’s other operations than electricity business.
Net cost of the electricity purchases of other companies in the same group
Report here the net cost of the electricity purchases of other companies in the same group. The net cost of electricity purchases is comprised of the purchase price of electricity as well as the income and losses from hedging electricity purchases as indicated in the accounts. Report this information only if the following conditions are met:
- The taxpayer company and another company belong to the same group (as defined in § 10, subsection 4 of the act on profit tax) and they have belonged to the same group for the entire tax year.
- The other group company is based in Finland.
- The net cost of electricity purchases relating to the other group company’s other operations has not been simultaneously taken into account in the calculation of the other group company’s own result of electricity business, or in the calculation of the result of electricity business for any other group company.
These conditions (described in § 10, subsection 5 of the act on profit tax) determine whether the net costs of electricity purchases conducted by other group companies for other operations can be taken into account when calculating the result of the taxpayer company’s internal electricity business. If these conditions are not met, leave this section empty.
Net sales of electricity business
Report here the net sales of electricity business according to the disaggregated financial statements.
Ratio of the net cost of electricity purchases to the net sales of electricity business
Based on the information above, determine the ratio of the net cost of electricity purchases to the net sales of electricity business. Enter the figure as a decimal. Include enough decimals so that the portion attributable to internal electricity business can be calculated accurately later in the return. MyTax will calculate this figure on your behalf based on the information you have given. Note that if the net cost of the electricity purchases by the company or other companies in the same group taken into account in the calculation of the portion attributable to internal electricity business exceeds the net sales of electricity business, the ratio of these figures cannot be greater than 1. Adjustment relating to internal electricity business cannot cause the result to be negative.
Result of internal electricity business not included in the taxable result
The following sections are for calculating the portion attributable to internal electricity business from the overall result of electricity business based on the ratio calculated above as well as the result of all electricity business.
Result of all electricity business
Report here the result of all electricity business. The result is calculated by subtracting the expenses of electricity business from the profits of electricity business and then adding any non-deductible interest related to electricity business in accordance with § 6, subsection 4 of the act on profit tax. If there are no such interests, you can enter the same value in this section as given for “Difference between the profits and expenses of electricity business”. MyTax will calculate this figure on your behalf based on the information you have given.
Portion of internal electricity business from the result of electricity business
Calculate the portion attributable to internal electricity business from the overall result of electricity business. This figure is calculated by multiplying the result of all electricity business with the ratio determined above. MyTax will calculate this figure on your behalf based on the information you have given. If you are filing on paper, copy this figure from the background calculations column to the tax calculation column.
Only the profitable portion of the result is taken into account in the tax calculation column. The entry made in this section cannot cause the result of electricity business to be negative.
Result of electricity business before losses from other group companies
Report here the result of electricity business before losses from other group companies have been taken into account. If the calculation result is negative, enter it in the section “Loss for electricity business”. The result is calculated by subtracting the expenses of electricity business from the profits of electricity business, adding the non-deductible portion of interest related to electricity business, and subtracting the portion attributable to internal electricity business calculated above. MyTax will calculate this figure on your behalf based on the information you have given.
Loss for electricity business
Report here the result of electricity business if the result is negative. Note that the portion attributable to internal electricity business cannot make the result negative. If it does, enter €0.00 as the result.
Group’s losses
If you demand that the losses of other group companies’ electricity business are taken into account in the company’s tax assessment, state so here.
I demand that the losses of other group companies’ electricity business are taken into account in the company’s tax assessment
If you file in MyTax, give the Business ID of the company whose losses you demand to be taken into account in your own tax assessment. If you file on paper, give the name of the company as well as its Business ID.
The Tax Administration will calculate the amount of loss and take it into account in the result of electricity business.
Basis of profit tax in the electricity sector
Basis of profit tax in the electricity sector
This section is for calculating the part of the result of electricity business that exceeds the limit of 10% of profit on the equity tied to the electricity business. The calculation result may also be below the 10% limit.
Any adjustments of equity related to electricity business are also calculated in this section. These may involve adding the acquisition cost of certain separately determined shares (in so-called Mankala companies) to the equity or calculating the portion attributable to internal electricity business that is not taken into account in the equity. These calculations should primarily be conducted using the disaggregated financial statements for electricity business concerning the year before the tax year. For the 2023 tax return this means the disaggregated financial statements for 2022, if the accounting period is the calendar year.
Adjustments of equity related to electricity business:
Equity according to disaggregated financial statements
Report here the equity according to the disaggregated financial statements for electricity business concerning the year before the tax year.
I demand that separately determined shares are included in the equity
If you demand that separately determined shares are included in the equity, state so here. If you are filing on paper and you make this demand, use the entries in the background calculations column to calculate the adjusted acquisition cost of separately determined shares. If you do not make such a demand, do not enter anything in this section’s background calculations column. Take the amount of equity according to disaggregated financial statements reported above and enter it directly in the section “Equity after adjustments”.
Acquisition cost of separately determined shares
Report here the acquisition cost of shares in a so-called Mankala company. Report the acquisition cost of the shares according to the disaggregated financial statements for electricity business concerning the year before the tax year, not the shares’ undepreciated acquisition cost in tax assessment.
Balance-sheet total of disaggregated financial statements
Report here the balance-sheet total of the disaggregated financial statements for electricity business concerning the year before the tax year.
Ratio of the acquisition cost of shares to the balance-sheet total of the financial statements
Calculate the ratio of the acquisition cost of separately determined shares to the balance-sheet total of the financial statements for electricity business. Enter the figure as a decimal. This figure is needed later for calculating the amount to be deducted from the value of the shares.
Restricted equity and invested unrestricted equity in total
Report here the sum total of restricted equity and invested unrestricted equity according to the disaggregated financial statements for electricity business concerning the year before the tax year.
If the taxpayer company is a limited liability company, restricted equity refers to the amounts of restricted equity described in the Limited Liability Companies Act (624/2006). Invested unrestricted equity refers to unrestricted equity that has been invested, for example funds of invested unrestricted equity. Invested unrestricted equity does not include earnings or losses retained from previous accounting periods, profits or losses of the current accounting period, or depreciation difference.
Amount to be deducted from the value of the shares
Determine the portion of the acquisition cost of separately determined shares that is not taken into account in the adjusted acquisition cost for these shares. This figure is calculated by multiplying the total amount of restricted equity and invested unrestricted equity with the ratio determined above (ratio of the acquisition cost of shares to the balance-sheet total of the financial statements). MyTax will calculate this figure on your behalf based on the information you have given.
Adjusted acquisition cost of separately determined shares
Based on the values calculated above, determine the adjusted acquisition cost of separately determined shares. This figure is calculated by subtracting the amount to be deducted from the value of the shares from the acquisition cost of separately determined shares. MyTax will calculate this figure on your behalf based on the information you have given.
If you are filing on paper, copy the sum total calculated in this section from the background calculations column to the tax calculation column. Note that the acquisition cost determined for the shares as the result of this calculation cannot be negative. If the adjusted acquisition cost entered in the background calculations column is negative, enter 0 in the tax calculation column or leave the cell empty.
If you have demanded that separately determined shares are included in the equity, the figure entered here will increase the figure entered for “Equity after adjustments”.
Equity after adjustments
Calculate the equity of electricity business adjusted with the acquisition cost of separately determined shares. This figure is calculated by adding the acquisition cost of separately determined shares to the equity according to disaggregated financial statements. MyTax will calculate this figure on your behalf based on the information you have given.
Equity tied to the operation of a permanent establishment, included in the balance sheet of electricity business
Report here the amount of equity tied to the operation of a permanent establishment that is included in the balance sheet of electricity business (§ 12, subsection 1, paragraph 1 of the act on profit tax). The figure entered here will decrease the amount entered for “Adjusted equity of electricity business”. The amount of equity tied to the operation of a permanent establishment is calculated by subtracting the permanent establishment’s debts from its assets.
Summary of internal electricity business
When the adjusted equity of electricity business is calculated in accordance with § 12, subsection 1, paragraph 2 of the act on profit tax, the portion attributable to internal electricity business is not included in the equity. The following sections are for calculating this portion.
Ratio of the net cost of electricity purchases to the net sales of electricity business
Determine the ratio of the net cost of electricity purchases to the net sales of electricity business.
This figure may not be greater than 1. The ratio has already been calculated above in the section “Internal electricity business”.
Equity of electricity business, portion attributable to internal electricity business
Calculate the portion attributable to internal electricity business from the equity of electricity business. This figure is calculated by multiplying the figure entered above for “Equity after adjustments” (i.e. the equity of electricity business adjusted with the acquisition cost of separately determined shares) with the ratio entered in the previous section. MyTax will automatically calculate this figure on your behalf based on the information you have given.
If you are filing on paper, copy this figure from the background calculations column to the tax calculation column. Note that if the portion is negative, it is not taken into account in the tax calculation. If the result of the calculation conducted in this section is negative, enter 0 in the tax calculation column or leave the cell empty.
The figure entered here will decrease the amount entered for “Adjusted equity of electricity business”.
Adjusted equity of electricity business
Calculate the adjusted equity of electricity business. This figure is calculated by subtracting from the value entered for “Equity after adjustments” the values entered for “Equity tied to the operation of a permanent establishment, included in the balance sheet of electricity business” and “Equity of electricity business, portion attributable to internal electricity business”.
10% annual profit on the equity of electricity business
Calculate the 10% annual profit on the equity of electricity business. This figure is calculated by multiplying the adjusted equity of electricity business determined in the previous section by 0.1.
Result of electricity business before losses from other group companies
Report here the result of electricity business before losses from other group companies have been taken into account. This amount has already been calculated in a previous section of the return. Use the same figure here.
Loss for electricity business
If the result of electricity business determined in the previous section would be negative, enter the figure here (without a minus sign).
Portion of the result of electricity business that exceeds (or remains below) the 10% profit limit, before losses from other group companies
Finally, determine the portion of the result of electricity business that exceeds (or remains below) the 10% profit limit before losses from other group companies are taken into account. This figure is calculated by subtracting the 10% annual profit on the equity of electricity business from the result of electricity business before losses from other group companies.
If you have demanded that the losses of other group companies’ electricity business are taken into account in the company’s tax assessment, the Tax Administration will calculate the amount of the losses to be taken into account. When the tax amount is determined, the portion of the result exceeding the 10% profit limit that you have entered here will be changed to reflect those losses.
MyTax will calculate this figure on your behalf based on the information you have given.
If the result is less than the 10% profit limit, enter a minus sign in front of the difference.