Reporting data to the Incomes Register: fringe benefits and reimbursements of expenses

These instructions are intended for payers of contributions. The examples in the instructions describe how various fringe benefits and reimbursements of expenses are reported to the Incomes Register.

Payments made must always be reported to the Incomes Register at least as a total amount (lower-detail level of reporting, the so-called reporting method 1). If the payer wishes, the payments made can be reported in more detail than required by the mandatory reporting method, using the separate complementary income types intended for the purpose (the higher level of detail for reporting, or the so-called reporting method 2). Regardless of the reporting method of monetary wages, fringe benefits and tax-exempt reimbursements of expenses must always be reported separately as specific income types.

The examples in these instructions describe the reporting of data both in total amounts and in an itemised manner. The examples do not include all mandatory data to be reported, only the data needed to report fringe benefits and reimbursements of expenses. For example, there are no separate instructions for the reporting of tax withholding. The sums used in the examples are examples only and the amount of social insurance contributions, the withholding rate, and the maximum amounts of tax-exempt reimbursements of travel expenses must be checked for each year. The withholding is determined on the basis of the withholding rate of each recipient.

The instructions describe reporting in domestic situations. Reporting data to the Incomes Register in international situations is described in the instructions Reporting data to the Incomes Register: international situations. Issues related to substitute payers or wage security are covered in the instructions Reporting data to the Incomes Register: payments made by substitute payer.

These instructions replace the earlier instructions named Reporting data to the Incomes Register: fringe benefits and reimbursements of expenses. The instructions have been updated:

• specified in more detail the reporting of an employer-subsidised commuter ticket benefit when reimbursement is collected for the benefit
• specified in more detail the reporting of a telephone benefit in the beginning of employment and when no other income is paid to the income earner
• added guidance on the reporting of a meal offered to an intern
• specified in more detail the use of insurance information submitted in connection with a reimbursement collected for other fringe benefits with the help of an example
• specified in more detail the reporting of the amounts of increase of increased reimbursements of expenses
• specified in more detail reporting with the income type Deduction before withholding (419).

1 Fringe benefits

Fringe benefits are non-monetary remunerations for work, which the employee receives from the employer. Fringe benefits are considered to be taxable wage income from which tax must be withheld and social insurance contributions paid by the employer who issued the benefit.

If the employer pays no monetary wages to the employee, tax cannot be withheld from the fringe benefit. If monetary wages that would suffice for withholding the employee’s earnings-related pension insurance contribution and unemployment insurance contribution have not been paid to an employee, the employer may withhold these employee’s insurance contributions in connection with later wage payments within the time limits prescribed by law. The employer reports these payments to the Incomes Register at Employee's unemployment insurance contribution and Employee's earnings-related pension insurance contribution in the payment day report containing the withholding from the employee. Withholding from fringe benefits is only reported to the Incomes Register if it has been performed.

If an employee receives only a fringe benefit without being paid any monetary wages, data on the amount of the benefit must be reported to the Incomes Register monthly. Enter the date during the month in which the benefit was available to the income user in accordance with the usage principle as the payment date (for example, the last day of the month).

If an employee is paid wages in two-week periods, some employers may divide the benefit in half for both periods. If the payer wishes, it can report the benefit twice per month by dividing the tax value between the two different pay periods of the same month. However, this requires that the wages for both pay periods are paid during the same month. The recommendation is, however, that fringe benefits be reported only once per month.

Fringe benefits must be reported to the Incomes Register even if the employee has paid the employer reimbursement for the fringe benefit equal to or exceeding the monetary value of the fringe benefit, with no remaining amount to be added to the wages. The reimbursement collected for the fringe benefit must be reported in the same earnings payment report as the fringe benefit. Even if the employer has collected a reimbursement for a fringe benefit that exceeds the tax value of the fringe benefit, the maximum amount reported in an earnings payment report as the reimbursement collected for a fringe benefit is the tax value. The collected reimbursement reduces taxable income and earnings from work on which social insurance contributions are based.

The Tax Administration confirms the monetary values of fringe benefits for each year in a decision. The decision can be seen at vero.fi > Detailed guidance > Decisions. If the taxable value of a benefit has not been separately confirmed in a decision issued by the Tax Administration, the value of the fringe benefit is its fair value. Fair value means the actual costs incurred by the acquisition of the benefit.

1.1 Fringe benefits that are always reported as specific income types

Car benefit, employer subsidised commuter ticket, and interest benefit for a housing loan are fringe benefits that are always reported as specific income types.

1.1.1 Car benefit

A car benefit is established for an employee when the employer provides the employee or their family with a car that the employer owns or possesses, and allows its private use.

The employer reports the amount of car benefit in the Incomes Register under the income type Car benefit (304). It is irrelevant whether the employer reports the monetary wages as a total sum (reporting method 1) or itemised (reporting method 2). In addition to car benefit, the employer must notify, as information on the Type of company car benefit, whether the benefit in question is a limited car benefit or full car benefit. In the case of limited car benefit, the employee pays for at least the fuel of the car. In the case of full car benefit, the employer pays all expenses incurred from the car.

The employer must report the Car age group to the Incomes Register by selecting A, B, C, or U from the list of values. Fringe benefit cars are divided into three age groups based on the car's registration year marked on the vehicle licence. This is the year when the car was registered for the first time. During the first three years of use, cars belong to age group A, during the three following years to age group B and after that, to age group C. The value U stands for car benefit used abroad and received abroad. In this case, the registration year is irrelevant.

If the operating costs of the employee’s car benefit are calculated as a per-kilometre value rather than a monthly value, the employer must report the Odometer reading to the Incomes Register. Enter the number of kilometres driven using a company car in private use in this field. According to the Tax Administration’s decision, the employer may report the data on the number of kilometres by pay period or, alternatively, in the last report of the year at the latest. If the employer does not receive information on the number of kilometres of a car benefit until after the month during which the benefit was available, the submitted report must be corrected.

The employer may collect the deductible of the car benefit from the net wages of the employee. In such a case, the employee actually pays the deductible, and this deductible of the car benefit decreases the taxable benefit or eliminates it entirely. If the deductible of the car benefit is lower than the taxable value of the car benefit, the difference between the value of the car benefit and the compensation collected for the car benefit is a taxable fringe benefit for the employee. If the deductible is equal to the taxable value of the car benefit, no taxable benefit is established. The employer reports the taxable value of the fringe benefit to the Incomes Register under the income type Car benefit (304) and the amount of deductible collected from the employee under the income type Compensation collected for car benefit (401).

The car benefit must be reported even if the employer has collected compensation from the employee for the fringe benefit, which is equal to or exceeds the monetary value of the fringe benefit, with no remaining amount to be added to the wages.

The deductible collected from the employee is reported separately under the income type Compensation collected for car benefit (401). Even then, the taxable value of the benefit is reported in full using the income type Car benefit (304), and the amount of the collected reimbursement is not deducted from it.

1.1.2 Employer-subsidised commuter ticket as fringe benefit

An employer-subsidised commuter ticket is a personal public transport ticket provided by the employer to the employee for commuting between the employee's residence and place of work. The employer-subsidised commuter ticket’s value is partly tax-exempt and partly taxable.

The taxable portion is a fringe benefit considered as wages. The employer-subsidised commuter ticket is tax-exempt income up to EUR 300. Furthermore, the ticket is considered tax-exempt income up to EUR 3,400 for the amount exceeding EUR 750. The employer must always report the employer-subsidised commuter ticket to the Incomes Register, even if there is no taxable benefit.

If the employees buy the ticket themselves, and the employer pays the price of the ticket or part of it to the employee, all of the compensation paid by the employer is considered to be the employee's wages.

The employer reports the tax-exempt share of the personal public transport ticket provided by the employer to the employee under the income type Employer-subsidised commuter ticket, tax-exempt share (341) and the share considered as wages under the income type Employer-subsidised commuter ticket, taxable share (342). The information must be itemised, because it affects the deductibility of the employee's travel expenses between home and work. The employer-subsidised commuter ticket benefit is always reported to the Incomes Register under the aforementioned income types. It is irrelevant whether the employer reports the monetary wages to the Incomes Register as a total sum (reporting method 1) or in an itemised manner (reporting method 2).

The reporting of an employer-subsidised commuter ticket differs from other fringe benefits, because the payer must deduct the reimbursement collected from the employee from the share deemed to be wages. The share of the benefit value from which the employer has already deducted a reimbursement it has possibly collected from the income earner is reported as the share deemed to be wages.

The share regarded as wages is subject to withholding and social insurance contributions. No tax is withheld or social insurance contributions are paid from the tax-exempt share.

The employer-subsidised commuter ticket benefit is reported as income for the pay period during which the benefit was processed in the employee's payroll calculation. If the tax-exempt employer-subsidised commuter ticket benefit is not processed in the payroll system at all, the tax-exempt employer-subsidised commuter ticket benefit can be reported just once per year. The recommendation is, however, to report the benefit in the report for the month during which the benefit is granted. If, for example, an income earner is granted EUR 300 in employer-subsidised commuter ticket benefit in February, the data is reported in the February earnings payment report. 

1.2 Fringe benefits that can be reported in two ways

Data can be reported to the Incomes Register using a lower or higher level of detail. Car benefit, employer subsidised commuter ticket, and interest benefit for a housing loan are fringe benefits that are always reported as specific income types, while accommodation benefit, telephone benefit, and meal benefit can be reported in two ways: either as a total sum under the income type Other fringe benefit or, alternatively, as specific income types.

If the employer reports accommodation benefit, telephone benefit, and meal benefit as a total sum under the income type Other fringe benefit (317), the employer must also specify the fringe benefits included in the reported total sum. This is done under Benefit type.

If the employer reports Accommodation benefit (301), Telephone benefit (330), and Meal benefit (334) as separate income types, the benefits in question will not be reported under the income type Other fringe benefit (317).

Even if the payer reports the aforementioned three fringe benefits (accommodation benefit, telephone benefit, and meal benefit) as separate income types, monetary wages can still be reported on the same earnings payment report in either way, as a total sum or in an itemised manner.

1.2.1 Accommodation benefit

An employee receives accommodation benefit when the employer provides the employee with an apartment owned or possessed by the employer, based on a lease relationship related to the employment, or as a benefit included in the pay. If the value of accommodation benefit has been reduced in accordance with the decision of the Tax Administration, report the reduced value to the Incomes Register.

The employer may report the accommodation benefit separately as a specific income type or as a total sum under the income type Other fringe benefit (317). If the employer reports using the latter method, using the Benefit type data related to the Other fringe benefit income type, the employer must also report that the income reported under the Other fringe benefit income type includes an accommodation benefit. If the benefit is reported separately under the income type Accommodation benefit (301), it is no longer reported under the income type Other fringe benefit.

1.2.2 Telephone benefit

An employee will receive telephone benefit when the employer pays the costs of the telephone subscription it provides, even for the employee’s private use outside working hours.

The employer may report the telephone benefit separately as a specific income type, or as a total sum under the income type Other fringe benefit (317). If the employer reports using the latter method, using the Benefit type data related to the Other fringe benefit income type, the employer must also report that the income reported under the Other fringe benefit income type includes a telephone benefit. If the benefit is reported separately under the income type Telephone benefit (330), it is no longer reported under the income type Other fringe benefit.

If an employee has received a telephone benefit immediately after employment commences, but the first less-than-full-month's monetary wages are paid only in connection with the next month’s wages, the telephone benefit for the first month can be reported with the same report along with the monetary wages paid for the month in question. In such a case, the telephone benefits for both the previous month and the current month are reported to the Incomes Register in addition to the wages paid.

If the income earner only has a telephone benefit, and no other income is paid to him or her, the telephone benefit can be reported in advance on the January report for the entire year in one go according to how the benefit has been processed in the payroll calculation. A benefit can be reported in one go only when the income earner's telephone benefit is not subject to earnings-related pension, unemployment, or accident and occupational disease insurance contributions, such as with YEL-insured shareholders. Another condition is that the person is not paid any other income or has not been issued any other benefit.

1.2.3 Meal benefit

An employee receives meal benefit when the employer provides its employees with meals at a price below the fair value or completely free of charge. An employer can subsidise meal costs with a meal ticket or other, similar targeted means of payment, or by arranging catering.

The employer may report the meal benefit separately as a specific income type or as a total sum under the income type Other fringe benefit (317). If the employer reports using the latter method, the employer must also report, using the Benefit type data related to the Other fringe benefit income type, that the income reported under the Other fringe benefit income type includes a meal benefit. If the benefit is reported separately under the income type Meal benefit (334), it is no longer reported under the income type Other fringe benefit.

If the employer collects from the employee a reimbursement for the meal benefit, corresponding to its taxable value, the information is reported to the Incomes Register as Reimbursement for a meal benefit corresponds to taxable value: Yes. EUR 0 is then reported as the tax value of the meal benefit using the income type Meal benefit (334). If the payer wishes, he/she can use the same income type to report the tax value of the meal benefit instead of EUR 0. If a reimbursement equalling the tax value of the meal benefit is collected from the employee, the Other fringe benefit income type must not be used. The amount collected for the meal benefit is not reported separately as Reimbursement collected for other fringe benefits.

Reporting a meal offered to an intern varies according to whether the intern receives a free meal in his or her educational institution during school days. Internship refers to an internship that forms part of the studies, an on-the-job learning period or a working life orientation period for pupils and immigrants (TET). If the intern receives a free meal during his or her school days from his or her educational institution, no taxable benefit is formed from meals given during the internship, and the offered meal is not reported to the Incomes Register as a benefit. If the educational institute does not offer free meals, a benefit taxable as earned income is formed from the meal offered at the place of the internship, reported to the Incomes Register using the income type Other taxable income deemed earned income (316).  The fair value of the meal is reported as the amount of the received benefit instead of the tax value of the meal benefit. If the payer collects a reimbursement for the meal, only the taxable share is reported to the Incomes Register. 

1.3 Other taxable fringe benefits

The income type Other fringe benefit (317) is used for reporting the total sum of the employer's non-monetary benefits, including accommodation, telephone, and meal benefit, unless these are reported as separate income types in the Incomes Register.

Other benefits reported using this income type include garage, motorcycle and boat benefit, life and pension insurance premiums deemed wages, benefit from a non-personalised gift voucher, and fringe benefits received by a person working as a seafarer.

In connection with the income type Other fringe benefit (317), the employer must indicate which fringe benefits are included in the sum paid. This is done by providing the Benefit type: Accommodation benefit, Telephone benefit, Meal benefit, Other benefits. Several values may be selected for the same sum.

If, exceptionally, the fringe benefit is not subject to the above-mentioned social insurance contributions, the payer reports this by using the Type of insurance information data group. More information on insurance is given in the instructions Reporting data to the Incomes Register: insurance-related data.

If the employer pays, on behalf of the employee, pension or insurance contributions when it would still be possible to withdraw these from the wages, this mainly constitutes earnings forming the basis for the employee’s pension, which is subject to earnings-related pension insurance contribution. In this case, the data is reported to the Incomes Register under the income type Other fringe benefit (317). As the income is subject to all insurance contributions, the information Type of insurance information need not be provided.

1.4 Reimbursement collected for other fringe benefits

The employer may withdraw the deductible from the employee’s net salary even for fringe benefits other than car benefit and the employer-subsidised commuter ticket. The deductible portion is reported to the Incomes Register under the income type Reimbursement collected for other fringe benefits (407). The income type Reimbursement collected for other fringe benefits (407) is used to report the share of the value of the fringe benefit collected from the employee. This income type is used to report the amount collected from the employee for fringe benefits other than a car benefit or employer-subsidised commuter ticket benefit. The value of the fringe benefit is also reported in full using its own income type. The income type Reimbursement collected for other fringe benefits is used to report the amount of the deductible collected from the employee.

A reimbursement collected for a fringe benefit must be reported in the same earnings payment report as the fringe benefit even if the reimbursement is collected in advance or later. If the collected reimbursement is not reported on the same earnings payment report as the fringe benefit, the reports remain erroneous from the perspective of the social insurers, as the insurance contributions are based on the wrong amount. For this reason, the insurers will later ask the payer to correct the report. 

Even if the employer has collected a reimbursement for a fringe benefit that exceeds the tax value of the fringe benefit, the maximum amount reported in an earnings payment report as the reimbursement collected for a fringe benefit is the tax value. The reimbursement collected for an employer-subsidised commuter ticket must be reported in full, however. The collected reimbursement reduces taxable income and earnings from work on which social insurance contributions are based. Even then, the fringe benefit is reported at its full tax value, with the collected reimbursement not deducted from it.

If the employer collects a reimbursement from the employee for a meal benefit, which corresponds to the benefit's taxable value, the information is reported to the Incomes Register as Reimbursement for a meal benefit corresponds to taxable value: Yes. EUR 0 is then reported as the tax value of the meal benefit using the income type Meal benefit (334). If the payer wishes, it can use the same income type to report the tax value of the meal benefit instead of EUR 0. If the employer collects a reimbursement from the employee for the meal benefit, corresponding to the benefit's taxable value, the amount of the meal benefit may not be reported under the income type Other fringe benefit (317) and by providing the information Benefit type: Meal benefit, because information on other fringe benefits can also be provided in the same report using this income type. The amount of meal benefit in euros cannot be separated from the total sum.

If the employer collects only a part of the meal benefit's tax value from the employee, the amount of the meal benefit is reported to the Incomes Register either by using the income type Meal benefit (334) or by using the income type Other fringe benefit  (317) and specifying Type of benefit: Meal benefit. The reimbursement collected from the employee reduces the amount of taxable meal benefit. The euro amount collected for the meal benefit is reported using the income type Reimbursement collected for other fringe benefits (407).

If the fringe benefit reported with the income type Other fringe benefit (317) is not subject to social insurance contributions and the payer has reported this by using the Type of insurance information data group, the equivalent Type of insurance information data must also be added to the income type Reimbursement collected for other fringe benefits (407), insofar as the collected reimbursement concerns the share of the benefit which is not subject to social insurance contributions. Even though the income type, by default, is not subject to social insurance contributions, the payer must confirm the data in the report as described above. This ensures that the Income Register's data users will obtain the correct data.

1.5 Fringe benefits and the usage principle

Fringe benefits are reported to the Incomes Register according to the usage principle. The benefit is income for the period of time in which it was available for the employee. The earnings payment report is given on the basis of the time of use of the fringe benefit. If an employee receives only a fringe benefit without being paid any monetary wages, data on the amount of the benefit must be reported to the Incomes Register monthly. Enter the date during the month in which the benefit was available to the income user in accordance with the usage principle as the payment date (for example, the last day of the month).

If the employee’s payday is in the middle of the month, for example, the information on the amount of meal benefit is submitted to the Incomes Register before the total amount of meal benefit is known for certain in the month in question (for example, the employer does not know if the employee is going to be absent). It is therefore considered sufficient that the meal benefit is balanced to the correct amount in the next earnings payment report at the latest. The amount of meal benefit for December must be corrected by submitting a substitute report for December, in order to correct the amount of meal benefit for the right tax year. If the meal benefit is implemented using a balance-based payment instrument (such as a payment card), the balancing must be done on the last earnings payment report for the year. For more information, see the Tax Administration’s instructions (in Finnish) Fringe benefits in taxation.

2 Reimbursements of expenses

2.1 Tax-exempt reimbursement of travel expenses paid to employees

Reimbursement of travel expenses received from the employer for business trips, daily allowance, meal allowance, allowance for accommodation, night travel allowance, and allowance for border crossing is not taxable income. Reimbursement of travel expenses includes kilometre allowances, including increases, incurred from the use of a vehicle during a commute. Tax-exempt kilometre allowances, daily allowances and meal allowances are reported to the Incomes Register.

Reimbursement of travel expenses paid to an employee is tax-exempt only insofar as it has been paid in accordance with the decision of the Tax Administration on tax-exempt reimbursement of travel expenses. The decision in force is available online at: vero.fi > Detailed guidance > Decisions. If the reimbursement of travel expenses has been paid contrary to the time and kilometre limits in accordance with the Tax Administration’s decision, it is entirely taxable and is reported as wages to the Incomes Register. If the employer pays the employee reimbursement of travel expenses in amounts exceeding the Tax Administration's decision, only the amount equalling the amount specified in the Tax Administration's decision of the reimbursement paid by the employer is tax-exempt income. The part exceeding this amount is taxable wages for the employee.

No tax is withheld or social insurance contributions are paid for tax-exempt reimbursement of travel expenses.

Taxable reimbursement of travel expenses or reimbursement of expenses must always be reported to the Incomes Register. Tax-exempt reimbursement of expenses is reported in the case of daily allowances, meal allowances, kilometre allowances, or other such situations referred to in the Tax Administration's decision on a general information-reporting requirement. The obligation to report these payments to the Incomes Register matches the previous reporting obligation in taxation.

Compensation paid for business travel expenses based on a certificate (e.g. a train ticket) issued by a transport operator is tax-exempt. Such compensation is not reported to the Incomes Register. Accommodation allowances, night travel allowances, or border-crossing allowances are not reported to the Incomes Register if they are paid in accordance with the maximum amounts specified in the Tax Administration's decision.

A travel advance is an amount paid by the employer to cover costs incurred by, for example, a business trip, such as interpretation costs. The travel advance does not need be reported to the Incomes Register. If, however, some of the travel advance remains unused and tax-exempt reimbursements of expenses paid to the income earner are offset from the remaining amount, the employer must report the share that was deemed expenses paid to the income earner as a daily allowance, kilometre allowance or an expense allowance. The obligation to report data arises once the travel invoice has been prepared and reimbursements of expenses paid to the income earner have been offset from the advance that was too large.

2.1.1 Kilometre allowance (tax-exempt)

Tax-exempt kilometre allowance can be paid both to employed persons and persons who are not employed but who receive personal fees referred to in the prepayment act (ennakkoperintälaki 1118/1996), such as meeting or lecture fees.

The amount of tax-exempt kilometre allowance is reported under the income type Kilometre allowance (tax-exempt) (311). In addition, the Number of kilometres is reported. In this section, the number of kilometres on which the tax-exempt kilometre allowance paid is based, is reported. The data on the number of kilometres can be submitted by pay period. At the latest, data on the number of kilometres based on which tax-exempt kilometre allowances have been paid during the year in question must, however, be submitted in the final report of the year.

In certain cases, the kilometre allowance paid for the use of a private car can be increased (such as when transporting other persons). The grounds for the increase are laid down in section 9(1) of the Tax Administration's decision. Report the total amount of the allowances paid, including the increases, using the income type Kilometre allowance (tax-exempt) (311).

2.1.2 Reimbursement of travel expenses between residence and specific place of work in the construction sector

According to the collective agreement of the construction sector, daily travel expenses between residence and place of work are reimbursed according to a special table. If the reimbursement according to the collective agreement is, at most, equal to the kilometre allowance specified in the Tax Administration Decision, the reimbursement is tax-exempt. Reimbursement higher than this is taxable for the part exceeding the maximum amount according to the decision. Reporting of taxable allowances is described in Section 2.2 Taxable reimbursement of travel expenses paid to employees.

The total amount of reimbursement of travel expenses paid according to the collective agreement of the construction sector is reported under the income type Kilometre allowance (tax-exempt) (311). The number of kilometres is not reported under Number of kilometres.

2.1.3 Daily allowance

A daily allowance is a tax-exempt reimbursement of a reasonable increase in meal and other living costs incurred by the recipient due to a business trip. Each year, the Tax Administration will confirm the maximum tax-exempt amounts in the decision it issues on tax-exempt reimbursement of travel expenses.

The total amount of tax-exempt daily allowances and meal allowances is reported under the income type Daily allowance (331). In addition, the Type of daily allowance is reported. Several values may be selected for the same sum. The type of daily allowance can be

• meal allowance,
• domestic full daily allowance,
• domestic partial daily allowance,
• international daily allowance,
• tax-exempt reimbursements relating to working abroad.

If only half the amount of daily allowance is paid because of a meal offered by the employer, the half amount of daily allowance is also reported under Type of daily allowance as domestic full daily allowance or international daily allowance. Correspondingly, any half amount of domestic daily allowance is reported under Type of daily allowance as domestic partial daily allowance.

Meal allowances are reported under the income type Daily allowance only if they are not reported as a separate Meal allowance (303) income type, see Section 2.1.4 Meal allowance.

The following tax-exempt allowances related to working abroad are also reported in the income type Daily allowance (331):

• the moving and travel costs of the taxpayer and their family member to the country of work and back;
• regular private household staff abroad, paid for by the employer; and
• primary and secondary education for children, paid for by the employer.

The Type of daily allowance information is reported as Tax-exempt reimbursements relating to working abroad.

2.1.4 Meal allowance

Tax-exempt meal allowance can be paid for meal expenses incurred from a business trip, if the employee does not have the opportunity to have a meal at their normal eating-place during their lunch break and the meal has not been arranged, for example, as a meal that forms part of the course package paid for by the employer. A tax-exempt meal allowance cannot be paid together with a tax-exempt daily allowance for the same business trip.

Report only the amounts of tax-exempt meal allowances under the income type Meal allowance (303). If the paid allowance exceeds the maximum amounts defined in the decision by the Tax Administration, or is paid in deviation from the grounds laid down in the decision, the payment should be reported as wages subject to social insurance contributions by using the income types for wages, such as time-rate pay.

A meal allowance can be reported separately, but it must be reported as at least a total sum, using the income type Daily allowance (331). In such a case, the Type of other reimbursement or benefit data related to the income type must also be used to report that the allowance reported under the income type Daily allowance includes a meal allowance.

If the meal allowance is reported separately, it is not reported under the income type Daily allowance.

2.2 Taxable reimbursement of travel expenses paid to employees

The reimbursement of travel expenses is entirely taxable, if it has been paid contrary to the time and kilometre limits in accordance with the Tax Administration’s decision. The reimbursement is equivalent to wages.

If the kilometre allowances are paid contrary to the Tax Administration's decision, they are reported to the Incomes Register either under the income type Total wages (101) (lower-detail reporting method 1) or income type Kilometre allowance (taxable) (209) (higher detail reporting method 2).

If the kilometre allowance has been paid in accordance with the Tax Administration’s decision, but in a larger amount than specified as tax-exempt in the decision, some of the allowance is wages and some is tax-exempt. The part exceeding the limits mentioned in the Tax Administration’s decision constitute wages. This part is reported either under the income type Total wages (101) or Kilometre allowance (taxable) (209). Only tax-exempt allowances are reported under the income type Kilometre allowance (tax-exempt) (311). The number of tax-exempt kilometres is reported under Number of kilometres.

By default, the income type Kilometre allowance (taxable) (209) is subject to social insurance contributions.

If the daily allowances or other compensations paid under the income type Daily allowance (331) are paid on grounds more lenient than those in the Tax Administration’s decision (for example full daily allowance for a 5-hour business trip), they must be reported under the income type Total wages (101) or Other compensation (216), and they are subject to social insurance contributions.

If compensation paid on more lenient grounds has been agreed in a collective agreement, it is not subject to pension, unemployment or accident and occupational disease insurance contributions. In such cases, the employer reports the income and specifies what part of the payment is subject to pension insurance contribution, unemployment insurance contribution, and accident and occupational disease insurance contributions. The compensation is subject to the employer's health insurance contribution.

2.3 Reimbursement of travel expenses paid by public sector entities

The state or its governmental institutions, municipalities or joint municipal authorities, churches, parishes or associations of parishes, and universities must also report all tax-exempt reimbursement of travel expenses paid in accordance with the Tax Administration’s decision. Even taxable reimbursement of expenses must be reported. The information is reported as stated in Sections 2.1 Tax-exempt reimbursement of travel expenses paid to employees and 2.2 Taxable reimbursement of travel expenses paid to employees. When reporting, public sector entities use the Payer type Public sector or State.

The reporting of reimbursement of expenses paid to persons participating in unpaid voluntary work in a public sector organisation is described in the instructions Rewarding employees, payments made to an entrepreneur and other special circumstances.

2.4 Taxable reimbursement of expenses

Taxable reimbursement of expenses is paid to employees as compensation for the costs directly incurred in the performance of work. The income type Taxable reimbursement of expenses (353) is used to report the total amount of taxable reimbursements of expenses that are not itemised using other income types.

The income type Taxable reimbursement of expenses (353) is used to report taxable reimbursement of expenses paid for non-business travel from which the employer does not withhold tax. These reimbursements of expenses are paid in addition to wages. These include costs incurred from obtaining tools and materials. Compensation for these costs is not considered wages when tax is withheld and the employer does not add them to the wages reported to the Incomes Register, for example in the income type Total wages (101) or Time-rate pay (201).

If an employee has acquired tools and work materials on behalf of the employer, their expenses are not reported if the employer has reimbursed the employee for them against a receipt.

The employer does not withhold tax or pay social insurance contributions from taxable reimbursements of expenses. However, reimbursements are taxable income for the employee. The employee must request the deduction of the actual expenses on their pre-completed tax return.

2.5 Deduction before withholding

Direct costs incurred from work, paid personally by the employee, are reported under the income type Deduction before withholding (419). The employer deducts these costs from the gross salary before withholding tax. Such expenses include expenses paid by the employee that are incurred from the use of a chainsaw, and other expenses arising from tools. Similarly, business travel expenses are such expenses, if the employer does not pay tax-exempt allowance for them in addition to wages.

In certain situations laid down in the law, the payer can also deduct such costs from the athlete's fee before withholding that were paid by the athlete himself or herself and that were directly incurred from sports.

Deduction made before withholding tax is reported under this income type. The amount of the deduction reported in this section must also be included in the salary reported to the Incomes Register. The maximum amount of deduction that can be reported is the amount of the payment.

If a single transaction includes wages subject to social insurance contributions and such wages in accordance with section 13 of the prepayment act (ennakkoperintälaki 1118/1996) on which social insurance contributions are not based, and expenses, which are deducted before withholding, are allocated to either income, the payer must report the data on the wages in two separate reports, and itemise which income the deduction applies to.

2.6 Other reimbursements of expenses

A reimbursement of expenses of a shareholder in a general partnership or a limited partnership, handled in the payroll accounting and invested in the company as a private investment, is reported to the Incomes Register in an earnings payment report using an income type suitable for the reimbursement in question, such as Daily allowance (331) or Kilometre allowance (tax-exempt) (311). The reporting obligation begins when the reimbursement of expenses is entered into the accounts as a private investment. The five-calendar-day deadline for reporting is counted from this moment. The payer reports the date of the accounting entry as the payment date.

Other non-wage compensations for work and compensations for use and reimbursement of travel expenses paid by non-profit organisations are described in the instructions Reporting data to the Incomes Register: rewarding employees, payments made to an entrepreneur and other special circumstances: Section 3 Payments to companies and entrepreneurs, Section 4 Compensation for use, Section 5.1.2 Athlete's fee, and Section 5.11 Allowance paid by non-profit organisation.