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How to submit a VAT return concerning VAT on imports

If you operate a business enterprise that imports goods and your enterprise has a VAT registration in Finland, indicate all the VAT information for the goods on your own initiative as you complete your VAT return.

Here is what to do:

1

Calculate the VAT base and amount

First, work out the sum serving as the base of the VAT. The base consists of the goods’ customs value, import expenses, and the duties, taxes and charges paid to Customs.
For more instructions on calculating the base, see Frequently asked questions below.

Now you can work out the amount of VAT:

VAT amount = base × VAT rate (24%, 14% or 10%)

In most cases, the VAT rate on imported goods is 24%. To check VAT rates, visit the Rates of VAT page. Note: Reduced rates are in effect for certain classes of imported goods as food, works of art, and others. For more information, see Customs website.

2

Submit a VAT return

Your VAT return must cover the VAT information on the imports, together with the tax period’s other VAT. Submit your VAT return in MyTax.

For more instructions, see Frequently asked questions below.

Go to MyTax

3

Pay the VAT

You can use MyTax to pay VAT for the tax period. However, if you use your e-bank or some other service to pay it, do not forget to enter the reference number for self-assessed taxes. Payment information, reference numbers, etc. can be checked in MyTax.

Go to MyTax

Frequently asked questions:

The VAT payable on imported goods is primarily based on their customs value. For more information, see the Customs website. Add any additional expenses such as insurance and transport to the customs value. Please note that part of the transport costs may already be included in the customs value. In this case, be careful not to repeat them in your calculation.

The following is a list of what to include in the VAT base for imported goods:

For detailed calculation rules, see “Base of VAT on imports” — Maahantuonnin arvonlisäveron peruste (guidance in Finnish and Swedish).

Include the freight costs related to the importation to the first place of destination in Finland, specified in the transport contract.

If, at the time of customs clearance, it is known to the importer that the goods will be transported to another destination located in Finland or elsewhere in the EU, the base of VAT must also include the cost to this destination.

Example: base of VAT for imports
A VAT-registered company is importing goods from China to Helsinki, Finland. The seller paid the freight, insurance and related costs to reach the port of destination, i.e. Helsinki. The seller’s invoice indicates a selling price that contains the above costs. After arrival in Helsinki, the goods are transported onwards to Tampere, the final known destination.

The customs clearance decision indicates that customs value is €12,550. This value is inclusive of the above freight, insurance and related costs as invoiced by the seller. Customs duties and other payments charged by Customs total €623.75. The costs of unloading and loading the goods on to lorries and transport from Helsinki to Tampere total €1,926.25.

The VAT base is €15,100 (customs value €12,550 + customs duties €623.75 + unloading and loading plus road transport from Helsinki to Tampere €1,926.25).

Example: calculating cargo, consisting of varying goods and VAT rates
A self-employed person who conducts business is importing goods subject to different VAT rates to Finland. Customs value of goods at the general VAT rate (24%) is €1,000. Goods with VAT rate 10% are €1,500 in customs value. Accordingly, the entire delivery’s customs value is €2,500.

The domestic freight cost of the delivery is €80. The share of freight costs, accounted for by goods subject to 24% VAT (the general rate) is determined by dividing the value of these goods (€1,000) by the value of all the goods (€2,500). Ratio is 1,000/2,500 = 0.40. Accordingly, the share of the freight is 0.40 × €80 = €32. The self-employed person includes the above freight cost (€32) in the VAT return under “Imports of goods from outside the EU”. Share of VAT (24%) is €32 × 0.24 = €7.68. It must be included under “Tax on imports of goods from outside the EU”.

Goods taxed at the lower VAT rate (10%) account for €1,500 of the delivery. This amount is divided by €2,500 the total value. The ratio is 1,500/2,500 = 0.60. Share of the freight is 0.60 × €80 = €48. The self-employed person includes the above freight cost (€48) in the VAT return under “Imports of goods from outside the EU”. The VAT on this domestic freight is €48 × 0.10 = €4.80. This must be included in the base subject to the 10-percent VAT rate, under “Tax on imports of goods from outside the EU”.

 

Include the VAT information in your VAT return for the tax period (month, quarter, or year as the case may be) when the customs clearance decision was issued. The date is at the top of the page on the new customs clearance system’s document, just under the “Customs decision” heading.

Enter the import VAT and the VAT base under:

  • Tax on imports of goods from outside the EU
  • Imports of goods from outside the EU

If the imported goods will be used for a business purpose that entitles you to VAT deduction, indicate the deductible VAT under “Tax deductible for tax period” on the same VAT return.

Example: The customs decision is dated 21 January 2022. Include all the information concerning the imported goods and VAT in the VAT return for January. If your tax period is the month, January’s VAT return must be submitted by 12 March 2022.

When you submit your VAT return, indicate the base, the amount of VAT and any deductions if the goods will be used for VAT-deductible purposes.

Instructions for completing the VAT return

If you import goods from another EU member state to the Åland Islands, include the VAT information in your VAT return for the tax period when the customs clearance decision was issued.

You can make use of comparison data when calculating your VAT because the search feature of MyTax allows you to search for similar imported goods that you are importing. Always check, however, that the comparison data is correct. If you detect any errors in the customs decision, please contact Customs (tulli.fi).

MyTax additionally shows a sum total (Customs’ comparison data on imports of goods), representing the import declaration data, for each tax period of your VAT returns. The total consists of customs values during the tax period according to customs decisions, of the duties imposed by Customs, and of taxes and other charges. You also have the option to drill down to detailed data on your company’s imports, sorted by customs decisions (click on Show detailed information).

Please note that the actual VAT base for imported goods is usually greater than the MyTax-displayed comparison data. The actual base is greater because it is inclusive of transport and other costs related to the importation that are excluded from the comparison data originating from Customs. More detailed guidance concerning the cost items that must be included is found in “the “Base of VAT on imports” — Maahantuonnin arvonlisäveron peruste (guidance in Finnish and Swedish).

You also have the option to search comparison data by customs decision in MyTax (Tax matters » Business operations » Comparison data on VAT on imports).

Your search terms can focus on a time frame of your choice, by reference to tax periods or by reference to clearance dates. Alternatively you can use other search terms, including

  • authorised representative’s name
  • customs clearance decision number
  • customs clearance value

You can get the search results in a .csv file to save them in your workstation (click Download as file).

Filter options for the results include “by decision number” and others (you can adjust the Filter feature as you prefer). After you select one of the decision numbers among your search results, further information will appear. This may be a reference to an Additional procedure relating to the customs clearance.

If you prefer, you can have certain customs decision information sent directly to your company’s accounting software system not only to MyTax. Information being available includes the decision number, customs clearance date, and customs value. You can contact your software provider to find out what needs to be done to get the online information directly for your accounting software system.

However, you can receive the above data without creating a link to your accounting software if you are an Ilmoitin.fi user. Read more about data requests and queries through Ilmoitin.fi.

Note: The Finnish Customs uses new import declaration forms as of April 2021. The new forms are for companies that submit declarations concerning goods to be released for free circulation. For example, updates were made to the codes on the import declaration that indicate Additional procedure. The new system had an impact on the comparison data saved in MyTax.

  • Accordingly, in the case of imports from another EU country to the Åland Islands, or imports between Finland and the Åland Islands (customs clearance across the customs border), the customs value in the comparison data in MyTax is always €0. In the same way, for goods of minor value cleared through customs, the comparison data in MyTax may contain no customs value. 

If MyTax fails to show the customs value, you must find it out yourself, relying on other methods, in order to calculate the VAT base.

If your VAT return contains an error, please correct it as soon as you notice it. Errors typically concern the VAT base and the VAT amount. The way to correct an error is to submit a replacement VAT return for the period when the error occurred. The replacement return replaces the previous return fully, so you must also include all the entries that were already correct in the original return.

Example: A company imported some goods and received a customs decision from Customs. The customs clearance date was 15 January 2022. The company provided information concerning the VAT base and amount on its VAT return for January 2022. Later, the company detects a wrong product name on the submitted import declaration. The error in product name results in an increase in customs duties. By the time the error was noticed, the customs decision was received already, so the company must submit a claim for revision. Read more about revision of a customs clearance decision on the Customs website (tulli.fi)

After the claim is processed, the company receives the Customs’ decision on the matter. The amended decision also affects the VAT base. The company submits a replacement VAT return, assigning it for the January 2022 tax period in accordance with the original customs clearance date (15 Jan 2022). The replacement VAT return contains the corrected VAT base and amount, along with all the other VAT information for the tax period.

However, if the erroneous amount of VAT was €500 max., either in excess or left out of the VAT return concerned, no replacement return is necessary because you can change the VAT amount on the next period’s VAT return.

Read more: How to make corrections to a VAT return

Further information on the Customs website:

Commodity codes of goods
How do I submit an import declaration?
Correcting an import declaration

When applying for revision of a customs clearance decision

If after goods are first exported to a non-EU country they are imported to Finland, the importation may be relieved from customs duties. For more information, see Import of returned goods (tulli.fi)

In some cases, VAT must be paid on return goods when they are imported. However, this kind of importation may also be VAT-exempt. The precondition for the VAT exemption for return goods is that Customs treats the importation as being free of customs duty. Further requirements for the exemption are that the goods were not exported VAT-free to a non-EU country; and that goods, which were used in Finland for a business purpose, were not sold outside the EU. It is also required that the importer of the goods is the same person or company as the exporter. Where questions on VAT treatment arise that remain open for interpretation, it is within the jurisdiction of the Tax Administration to settle the question.

If the importer of return goods is VAT-registered in Finland, the importer must submit a report concerning the importation to the Tax Administration even if the importation were VAT-exempt and no VAT payment were required. VAT base is calculated in the same way for both taxable and tax-exempt imports. Your VAT return for the tax period must cover the VAT information on imports together with the tax period’s other VAT.

If the import of return goods is VAT-exempt, you are required to report

  • The VAT base for imported goods under “Imports of goods from outside the EU”.
  • Enter the amount of VAT under “Tax on import of goods from outside the EU” as 0,00 (because if the importation is tax-exempt, no calculation of VAT on import is performed).

If the import of return goods is subject to VAT, you are required to report

If the additional requirements for VAT exemption are not met, you must pay VAT on the importation of the return goods although the customs duty might be relieved when they were imported.

Example: The company called A Oy owned a machine that was in use for a business purpose that entitled A Oy to VAT deduction. Later, in September 2021, the company exported the machine to Norway in order to use it for work performance. In August 2022 still in Norway, the company sold the machine to B Oy, another Finnish VAT-registered company. After that, B Oy imports the machine back to Finland.

B Oy submits an import declaration to Customs, and the machine is cleared and released for free circulation. The importation is duty-free in accordance with provisions of the European Customs Code concerning return goods. However, because the machine had previously been in Finland in business use entitling its owner to VAT deduction, the importation fails to fulfill the requirements for exemption from VAT on imports. This means that to import the machine to Finland is subject to import VAT.

B Oy includes information on its VAT on imports in the VAT return to be submitted for August:

  • entering the VAT base under “Imports of goods from outside the EU”;
  • entering the amount of VAT under “Tax on imports of goods from outside the EU”; and
  • if the machine is purchased for a business purpose that entitles B Oy to VAT deduction, the amount of VAT is again entered under “Deductible VAT for the tax period”.

 

The payer of VAT on imports is the person, company or other party in whose name the customs declaration is submitted. If the goods are imported for a business purpose, it is required that the declaration be filed in the name of the VAT-registered company that will utilize the goods in its conduct of business.

The submitter of the declaration may also be an indirect representative. It means that the representative acts in its own name but on behalf of the actual importer, often also called the principal. In this case, the payer of VAT on imports is then the importer of the goods, namely, the principal. If you provide services as an indirect representative, enter your principal’s Business ID or personal identity code on the customs declaration. Enter the principal’s personal identity code when your principal is a private individual who will use the goods for private nonbusiness purposes. In the case of indirect representation, the Åland Islands are an exception to the main rule.

If an indirect representative, for example, submits an import declaration to the Customs by mistake, indicating that the importer is a company other than the one using the goods for a business purpose entitling to VAT deduction, it is necessary to apply to Customs to have a revision of the customs decision carried out. Read more about revisions of a customs decision on the Customs website.

Page last updated 11/22/2022