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, except in Section 1.6. 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 Correcting data in the Incomes Register.

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

• Added instructions to Section 1.1.3 regarding how to report a bicycle benefit provided by deducting the benefit from monetary wages when the bicycle is also used by the employee during an unpaid absence.
• Added the reporting date to Example 28 in Section 1.3 and added a new example regarding a situation where employee contributions have been left uncollected over several months. The text in the section has also been specified.
  
• Added guidance on reporting fringe benefits during an unpaid absence to Section 1.5.

The amounts of the employee’s earnings-related pension and unemployment insurance contributions used in the examples of these instructions are at the 2023 level. The amounts valid in each year are presented on the insurance information page. The amount valid for employees under 53 years of age and employees over 62 years of age has been used as the amount of the employee’s earnings-related pension insurance contribution.

When these instructions discuss tax-exempt reimbursements of travel expenses, including daily, kilometre and meal allowances, their maximum amounts are in accordance with the decision valid in 2023. The amounts valid in each year are presented in the Finnish Tax Administration’s decision on tax-exempt allowances for business travel.

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. If, in the situation described above, the employee's social insurance contributions are not collected in connection with a later payment of wages, the employer contributions paid by the employer are reported on the earnings payment report as other fringe benefits paid to the employee; for more details, see Section 1.3. Withholding from fringe benefits is only reported to the Incomes Register if it has been performed.

Fringe benefit data must be submitted no later than on the fifth day of the calendar month following the fringe benefit's accrual month. However, if monetary wages are paid for the fringe benefit's accrual month during the calendar month following the accrual month, the fringe benefit data can also be submitted by reporting the fringe benefit as income for the calendar month following its accrual month. The report must then be reported no later than on the fifth day of the calendar month following the month as the income for which the fringe benefit was reported. Accrual month means the calendar month during which the benefit was available.

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 of the month in which the benefit was available to the income earner as the payment date (for example, the last day of the month).

If an employee is paid wages in two-week periods, the payer, if it so wishes, can report the benefit twice per month by dividing the taxable value between the two different pay periods of the same month. The recommendation is, however, that fringe benefits be reported only once per month. The deadlines for reporting fringe benefits are described in more detail in Section 1.5.

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 taxable value of the fringe benefit, the maximum amount reported in an earnings payment report as the reimbursement collected for a fringe benefit is the taxable 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 Tax Administration’s decision on calculation principles applied to fringe benefits in the tax assessment for 2022. 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, bicycle benefit 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.

If the employer has reduced the amount of the car benefit because the company car has zero or low emissions, the employer must also indicate the Car emissions value. The amount of the car benefit can be reduced if the car’s real carbon dioxide emissions (CO2 emissions) are 0–100 grams per kilometre as laid down in the car tax act (Autoverolaki 777/2020). Reducing the amount is based on section 64a of the act on income tax (Tuloverolaki 1535/1992), and reductions are valid until 2025. This is why the car emissions value is reported for 2022–2025. The emissions value is reported monthly in conjunction with the reduced taxable value of the car benefit.

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. Even if the employer has collected a reimbursement for a car benefit that exceeds its taxable value, the amount reported as the reimbursement collected for the car benefit on the earnings payment report must not exceed the taxable value.

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. The reimbursement collected for a car benefit must be reported on the same earnings payment report as the car benefit, even if the employer collects the reimbursement during the pay period before or after the pay period in which the car benefit is reported.

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 3,400. If an employee has both an employer-subsidised commuter ticket and a bicycle benefit, their total tax-exempt amount can be at most EUR 3,400 per calendar year. The employer must always report the employer-subsidised commuter ticket to the Incomes Register, even if no taxable benefit is established.

The employer reports the tax-exempt share of the employer-subsidised commuter ticket 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 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.. If no benefit deemed to be wages is created, the employer must deduct the reimbursement collected from the employee from the tax-exempt share of the employer-subsidised commuter ticket. The remaining amount must be reported as the tax-exempt share of the employer-subsidised commuter ticket.

To regard the benefit as an employer-subsidised commuter ticket, the ticket must be acquired by the employer. The employer can acquire the employer-subsidised commuter ticket in various ways:

1. The employer acquires the ticket or agrees with the service provider that the ticket is invoiced in full or in part from the employer.

• The benefit is deemed to be earned during the month, during which the employee receives the ticket.

2. The employer provides an employee with a commuting voucher or card, using which the employee acquires the ticket.

• The benefit is deemed to be earned during the month, during which the employer provides the commuting voucher or card entitling the employee to purchase the employer-subsidised commuter ticket. The time of provision also determines the ticket’s tax year.

3. The employer provides an employee with a digital commuting voucher or card, or tops up the employee’s user account in a mobile app for buying an employer-subsidised commuter ticket. The employer buys the ticket.

• The benefit is deemed to be earned during the month, during which the employee purchases the ticket. The time of purchase also determines the ticket’s tax year.

If the employer does not acquire a ticket, but the employee purchases it, and the employer pays the ticket price or part of it to the employee, the question is not of an employer-subsidised commuter ticket. In this case, the whole reimbursement paid by the employer is deemed to constitute the employee’s wages. The amount paid to the employee is reported under the income type Total wages (101) or Other compensation (216).

The employer can report the employer-subsidised commuter ticket in connection with the wages accrued during the same period of time. If, for example, the employer has given an employer-subsidised commuter ticket in December, but the wages accrued in December are not paid to the employee until January, the employer can report the employer-subsidised commuter ticket in connection with the monetary wages paid in January. Alternatively, the employer can report the benefit separately on its own report no later than on the fifth of February. A payment date in January must be entered as the payment date, for example the last day of January. The benefit is then deemed January's income for the income earner and is taken into account when euro-denominated limits for the tax year starting from January are monitored.

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 once per year. However, it is recommended that the benefit be reported on the report for the month, for which the benefit is regarded as earned income (see examples above for the various ways to acquire a ticket). 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. If, however, the wages accrued in February are paid in March, the employer-subsidised commuter ticket benefit can be reported in connection with the March payment of wages or separately on the fifth of April.

If the employer does not provide payment instruments entitling the employee to purchase a ticket, but acquires a ticket for the employee’s use the validity period of which overlaps two different years, the employer must distribute the ticket price to these years in proportion with the ticket’s validity periods in the different years and report the data correspondingly on earnings payment reports. The ticket must be reported in this way, even if the tax-exempt employer-subsidised commuter ticket is not processed in the payroll system.

The employer may collect the deductible from the employee’s net wages. The deductible portion is reported under the income type Reimbursement for employer-subsidised commuter ticket (415). The collected reimbursement is reported in full even if it is greater than the share deemed to be wages. The collected reimbursement must be deducted from the share deemed to be wages. The remaining amount must be reported as the taxable share deemed to be wages.

If no benefit deemed to be wages is created, the employer must deduct the reimbursement collected from the employee from the tax-exempt share of the employer-subsidised commuter ticket. The remaining amount must be reported as the tax-exempt share of the employer-subsidised commuter ticket.

If an employee has both an employer-subsidised commuter ticket and a bicycle benefit, their total tax-exempt amount can be at most EUR 3,400. Therefore, the bicycle benefit provided by the employer reduces the maximum tax-exempt amount of the employer-subsidised commuter ticket.

In the case of employer-subsidised commuter tickets, the amounts of taxable and tax-exempt benefit is estimated for the entire year unlike with other fringe benefits, the amounts of which are estimated for one month at a time. If an employer-subsidised commuter ticket is granted once per year, for example at the start of the year, and a reimbursement is collected regularly, the person would, in practice, incur a taxable benefit at the start of the year as the payer has not yet had time to collect more than the first month's reimbursement for the benefit. So that the payer does not need to correct submitted reports in a situation described above, the payer can anticipate the situation in advance, divide the tax-exempt share over the entire year and report it monthly to the Incomes Register together with the collected reimbursement.

If the employer-subsidised commuter ticket benefit has been granted at the start of the year for the entire year, and the employment is terminated in the middle of the year, the payer must correct the reports it has submitted. In such a case, only the part during the time of employment is employer-subsidised commuter ticket benefit. The rest of the value of the commuter ticket is wages, unless the employer collects a reimbursement for it. The ticket must be corrected into wages using income types for wages no later than during the last wage payment month.

An employer-subsidised commuter ticket is granted by deducting the benefit from the employee’s monetary wages

The employer-subsidised commuter ticket benefit can be granted by deducting it from the employee’s monetary wages by separate agreement between the employer and the employee. In this case, the amount corresponding to the granted tax-exempt fringe benefit’s value is deducted from the employee’s monetary wages. This means that the fringe benefit reduces the amount of the employee’s taxable gross wages. It also reduces the amount of the employee’s wages subject to withholding and health insurance contributions. However, it should be noted that the earnings-related pension and unemployment insurance contributions and the accident and occupational disease insurance contributions are calculated based on the amount of the wages before the value of the fringe benefit is deducted. From the point of view of the earnings-related pension, unemployment insurance, and accident and occupational disease insurance contributions, tax-exempt fringe benefits that are granted as deductions from monetary wages are paid as remuneration for work, which is why the amount of income used as the grounds for these contributions is different from the amount considered as taxable income. The employer reports that the benefit provided by deducting the benefit from the employee’s monetary wages is subject to pension, unemployment, and accident and occupational disease insurance contributions by connecting information about Types of insurance information to the income type Employer-subsidised commuter ticket, tax-exempt share (341). Otherwise, the employer-subsidised commuter ticket benefit is reported to the Incomes Register similarly to typical fringe benefits granted as wage supplements.

If part of the employer-subsidised commuter ticket is a taxable benefit, it is reported to the Incomes Register using income type Employer-subsidised commuter ticket, taxable share (342).

If a reimbursement has exceptionally been collected for the employer-subsidised commuter ticket benefit granted by deducting it from the employee’s monetary wages, it is reported using income type Reimbursement for employer-subsidised commuter ticket (415). The payer deducts the reimbursement collected from the share reported using income type Employer-subsidised commuter ticket, taxable share (342). If there is no share deemed to be wages, the payer deducts the reimbursement collected from the share reported using the income type Employer-subsidised commuter ticket, tax-exempt share (341). If there is no share deemed to be wages and the collected reimbursement is deducted from the tax-exempt share, earnings subject to earnings-related pension, unemployment, and accident and occupational disease insurance contribution will decrease correspondingly. The payer reports the amount subject to social insurance contributions by connecting the Type of insurance information to income type 341.

Read more in the instructions Työsuhdepolkupyöräedun ja työsuhdematkalippuedun ottaminen huomioon eläkkeen perusteena olevassa työansiossa (Taking the bicycle benefit and employer-subsidised commuter ticket benefit in earnings from work used as the basis of pensions) (tyoelakelakipalvelu.fi).

1.1.3 Bicycle benefit

A bicycle benefit is established when the employer provides a bicycle for an employee for private use. The bicycle may be owned by the employer or acquired through a leasing agreement. A bicycle benefit is also established if the employer provides, by other similar means, an employee with an opportunity to use a bicycle during their leisure time.

EUR 1,200 per year of the bicycle benefit is tax-exempt income and any amount in excess of this limit is a taxable fringe benefit. If an employee has both a bicycle benefit and an employer-subsidised commuter ticket, their total tax-exempt amount can be at most EUR 3,400. In other words, the tax-exempt bicycle benefit is deducted from the maximum tax-exempt amount of the employer-subsidised commuter ticket.

The value of the bicycle benefit is determined according to the fair value. Every year, the Tax Administration issues calculation principles for the fair values of fringe benefits. The calculation of the amount of the bicycle benefit is described in the Tax Administration Guidelines Fringe benefits in taxation and the Tax Administration’s decision on calculation principles for fringe benefits applied to taxation.  

The bicycle benefit must always be reported on an earnings payment report, also when no taxable benefit is established.

A tax-exempt bicycle benefit must be reported as income for the pay period in which the benefit was handled in the payroll accounting for the employee. If a tax-exempt bicycle benefit is not handled in the payroll system at all, the tax-exempt bicycle benefit can only be reported once a year. The recommendation is, however, to report the benefit in the report for the month during which the benefit is granted. Instead, the taxable share of a bicycle benefit regarded as wages must be reported over the months, during which the employee had access to the benefit. The taxable and tax-exempt shares of a bicycle benefit must be itemised, because they affect the deductibility of the employee’s travel expenses between home and work.

The reporting of a bicycle benefit differs from other fringe benefits, similarly to the reporting of an employer-subsidised commuter ticket, 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.

If no benefit deemed to be wages is established, the employer must deduct the reimbursement collected from the employee from the tax-exempt share of the bicycle benefit. The remaining amount must be reported as the tax-exempt share of the bicycle benefit.

A bicycle benefit is granted by deducting the benefit from the employee’s monetary wages

The bicycle benefit can be granted by deducting it from the employee’s monetary wages by separate agreement between the employer and the employee. In this case, the amount corresponding to the granted tax-exempt fringe benefit’s value is deducted from the employee’s monetary wages. This means that the fringe benefit reduces the amount of the employee’s taxable gross wages. It also reduces the amount of the employee’s wages subject to withholding and health insurance contributions. However, it should be noted that the earnings-related pension and unemployment insurance contributions and the accident and occupational disease insurance contributions are calculated based on the amount of the wages before the value of the fringe benefit is deducted. From the point of view of the earnings-related pension, unemployment insurance, and accident and occupational disease insurance contributions, tax-exempt fringe benefits that are granted as deductions from monetary wages are paid as remuneration for work, which is why the amount of income used as the grounds for these contributions is different from the amount considered as taxable income. The employer reports that the benefit provided by deducting the benefit from the employee’s monetary wages is subject to pension, unemployment, and accident and occupational disease insurance contributions by connecting information about Types of insurance information to the income type Bicycle benefit, tax-exempt share (363). Otherwise, the bicycle benefit is reported to the Incomes Register similarly to typical fringe benefits granted as wage supplements.

If part of the bicycle benefit is a taxable benefit, it is reported to the Incomes Register using income type Bicycle benefit, taxable share (364).

If a reimbursement has exceptionally been collected for the bicycle benefit granted by deducting it from the employee’s monetary wages, it is reported using income type Reimbursement collected for bicycle benefit (420). The payer deducts the reimbursement collected from the share reported using income type Bicycle benefit, taxable share (364). If there is no share deemed to be wages, the payer deducts the reimbursement collected from the share reported using income type Bicycle benefit, tax-exempt share (363). If there is no share deemed to be wages and the collected reimbursement is deducted from the tax-exempt share, earnings subject to earnings-related pension, unemployment, and accident and occupational disease insurance contribution will decrease correspondingly. The payer reports the amount subject to social insurance contributions by connecting the Type of insurance information to income type 363.

Unpaid absence and a bicycle benefit given by deducting the benefit from monetary wages

A bicycle benefit must also be reported monthly to the Incomes Register during unpaid absences if both of the following conditions are met:

• the bicycle benefit is granted by deducting the benefit from the employee’s monetary wages
• the bicycle is also used by the employee during the unpaid absence.

The unpaid absence can concern alternation leave or a lay-off. In this case, the bicycle benefit is also income subject to earnings-related pension and unemployment insurance contributions and accident and occupational disease insurance contributions.

Because the employer and employee have agreed that the benefit is included in total wages, the employer can reduce the employee’s wages by the amount of the bicycle benefit before the absence or when the employee returns to work. If the employer does this, the reduced amount of monetary wages is taxable income subject to health insurance contributions. In contrast, the amount of total earnings agreed for work during the month is taxable earnings from work subject to earnings-related pension and unemployment insurance contributions and accident and occupational disease insurance contributions. For social insurance providers to have the data they require, the employer must, in this situation, use income types intended for substitute payer situations (322–324). They are used to submit data about deducted income when wages are reduced, and this data can then be obtained by social insurance providers.

Read more in the instructions Työsuhdepolkupyöräedun ja työsuhdematkalippuedun ottaminen huomioon eläkkeen perusteena olevassa työansiossa (Taking the bicycle benefit and employer-subsidised commuter ticket benefit in earnings from work used as the basis of pensions) (tyoelakelakipalvelu.fi). 

Because the employer and employee have agreed that the benefit is included in total wages, the employer can reduce the employee’s wages by the amount of the bicycle benefit before the absence or when the employee returns to work. If the employer does this, the

1.1.4 Interest benefit for a housing loan

An interest benefit for a housing loan is established when the employer collects annual interest on a housing loan it has granted to an employee that is lower than the reference interest rate commonly used in the market. “Reference rate” means the Euribor rate of 1, 3, 6 or 12 months or another reference rate that a bank generally uses when granting credit for its customers, such as the bank’s prime rate. This type of an interest benefit is handled as wages in taxation.

The employer reports the amount of the taxable interest benefit under the income type Interest benefit for a housing loan (302). The interest benefit is subject to withholding, but not to social insurance contributions.

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, bicycle benefit 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 (317) 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 using the income type Accomodation benefit (301) 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, it is no longer reported under the income type Other fringe benefit.

1.2.2 Telephone benefit

A telephone benefit is established for an employee when the employer pays the costs of the telephone subscription it has acquired and paid for the employee, even for the employee’s private use outside working hours.

The employer may report the telephone benefit separately using the income type Telephone benefit (330) 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, it is no longer reported under the income type Other fringe benefit.

If monetary wages are paid for the telephone benefit's accrual month during the calendar month following the accrual month, the telephone benefit can be reported as income for the calendar month following its accrual month. The report must then be reported no later than on the fifth day of the calendar month following the month as the income for which the telephone benefit was reported. Accrual month means the calendar month during which the benefit was available. Thus, if the employee received the telephone benefit upon the start of their employment in mid-April, but monetary wages for less than a month of work in April are not paid until the May payment of wages, the telephone benefit for April can be reported in May on the same report as the monetary wages accrued in April, or separately on the fifth day of the month following the payment of wages, i.e. on the fifth of June.

If the income earner only has a telephone benefit, 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, if the following conditions are met:

• the telephone benefit is not subject to earnings-related pension, unemployment, or accident and occupational disease insurance contributions, such as YEL-insured shareholders
• no other income is paid or no other benefit given to the person.

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, such as a lunch voucher, or other, similar targeted means of payment, such as a payment card or a mobile application, or by arranging catering. The amount of meal benefit must be reported to the Incomes Register on a monthly basis, independent of the type of meal benefit. For more information about the meal benefit reporting and adjustment date, see Section 1.5.

The employer may report the meal benefit separately using the income type Meal benefit (334) 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, 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. In this case, the amount of meal benefit is not recommended to be reported. If a reimbursement equalling the taxable 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.

Due to their work-related tasks, an employee may exceptionally have access to two meal benefits during a single pay period so that the reimbursement collected from one benefit corresponds to the taxable value and a reimbursement lower than the taxable value is collected from the other. In this case, the employer must report the total amount of the meal benefits under the income type Meal benefit (334) or Other fringe benefit (317). The collected reimbursement is reported as a total amount using the income type Reimbursement collected for other fringe benefits (407).

If the employer collects a reimbursement for the meal benefit that is smaller than its taxable value from the employee, the employer must report the meal benefit either by using income type Meal benefit (334) or by using income type Other fringe benefit (317) and specifying Type of benefit: Meal benefit. The collected reimbursement is reported separately using income type Reimbursement collected for other fringe benefits (407). The amount of the meal benefit's taxable value is reported as the meal benefit and the amount of the deductible collected from the employee as the collected reimbursement. Even if the reimbursement collected from the employee reduces the amount of the taxable meal benefit, the employer reports the value of the benefit in full and does not subtract the amount of the collected reimbursement from the amount of the meal benefit when reporting the data.

You can find more examples of reimbursements collected for a meal benefit in Section 1.4, 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. 

In the case of a meal subsidy, the data is not reported to the Incomes Register. A meal subsidy is in question when the employer subsidises the meals of its employees in a different way than by giving the employees a meal benefit referred to in the fringe benefit decision. The employer typically makes an agreement with a restaurant, according to which the employer subsidises the meals of its employees by a certain euro amount per meal, and the restaurant correspondingly charges a lower price from the employees. If the amount of the subsidy does not exceed the indirect costs of the restaurant, the employee does not receive a taxable benefit. No benefit is established then even if the price paid by the employee is below the value of the meal benefit, and the subsidy is not 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. A fringe benefit received when working as a seafarer and any reimbursement recovered from it must be accompanied by additional information to indicate that the payment was paid as seafarer’s income.

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 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. Such a situation exists, for example, when the employer pays earnings-related pension and unemployment insurance contributions on the employee’s behalf and they can no longer be collected from the employee by law (for more information, see the instructions Correcting data in the Incomes Register, Section 3.3.1.2 Correcing a collected contribution when the amount was too small).

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, for example, because wages are still paid and the statutory deadline has no yet elapsed, this mainly constitutes earnings forming the basis for the employee’s pension, which is subject to earnings-related pension insurance contribution. The payments are wages used as grounds for the unemployment insurance contribution in this situation as well. 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, bicycle 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 taxable value of the fringe benefit, the maximum amount reported in an earnings payment report as the reimbursement collected for a fringe benefit is the taxable 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 taxable 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. The income type Meal benefit (334) must still be given, but the amount can be left blank.  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 taxable 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.

If there is an error in the amount of the reported fringe benefit, the amount of the fringe benefit must be corrected on the report for the original month when the fringe benefit was used. The fringe benefit cannot be an unjust enrichment, because the person has had access to the benefit during that time. In certain situations, the share of the fringe benefit can, however, be collected from monetary wages. In this case, the employer must report the collected amount as reimbursement collected for fringe benefits. Correcting fringe benefits is described in more detail in Section 3.2.2, Collecting fringe benefits from monetary wages, of instructions Correcting data in the Incomes Register.

1.5 Deadline for reporting fringe benefits and the usage principle

Before 2020, fringe benefits were, as a rule, reported to the Incomes Register according to the usage principle, which means that the benefit is income for the time period during which it was available to the employee for use. The earnings payment report was submitted on the basis of the time the benefit was used.

As of 2020, fringe benefits still must be reported no later than on the fifth day of the calendar month following the fringe benefit's accrual month. If an employee receives only a fringe benefit without being paid monetary wages, data on the amount of the benefit must be reported to the Incomes Register monthly, no later than on the fifth day of the month following the accrual month. The payment date specified on the earnings payment report must be in the month during which the benefit was available to the income earner in accordance with the usage principle; for example, the last day of the month.

As of 2020, fringe benefits can always be reported no later than on the fifth day of the month following the accrual month, regardless of the time of the month when the monetary wages were paid.

If monetary wages are paid for the fringe benefit's accrual month during the calendar month following the accrual month, the fringe benefit can also be reported as income for the calendar month following its accrual month. The report must then be submitted no later than on the fifth day of the calendar month following the month as the income for which the fringe benefit was reported.

If wages are paid for the fringe benefit's accrual month on several payment dates, the fringe benefit can be reported no later than on the fifth day following the last payment of wages. In this situation, it does not matter in which month the last payment of wages takes place. Alternatively, the fringe benefit must be reported on the fifth day of the month following the last payment of wages.

If the employee's fringe benefit changes, the payroll department may not be informed of the change until after the payment of wages. If the amount of the fringe benefit reported to the Incomes Register has been incorrect, the submitted report must be corrected.

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, however, wages accrued in December are paid in January, the data on the amount of the meal benefit for December can be reported on the January report. 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.

If an employee has access to a fringe benefit, it must be reported monthly to the Incomes Register, even if no wages are paid to the employee due to alternation leave, a lay-off or another unpaid absence. If the employer collects a reimbursement for the fringe benefit during the unpaid leave, the reimbursement must be reported monthly with the fringe benefit. However, the employer can collect the reimbursement as a total sum from the employee before the unpaid absence or later when the employee returns to work. In this case as well, the reimbursement collected must be reported monthly with the fringe benefit. For more detailed instructions for reporting reimbursements collected, see Section 1.4, Reimbursement collected for other fringe benefits. In addition, see more detailed instructions for reporting a bicycle benefit during an unpaid absence in Section 1.1.3, Bicycle benefit.

1.6 Reporting the tax withheld from fringe benefits

The data is reported to the Incomes Register according to the payment principle. Correspondingly, the taxes withheld are reported on the report for the pay period during which they were withheld from the wages. If the employee's wages solely comprise non-monetary benefits, such as fringe benefits, taxes cannot be withheld, and therefore they also cannot be reported. Taxes withheld from fringe benefits are reported only when they are actually collected from the employee or the employee pays an amount corresponding to the withholding to the employer.

Taxes are withheld from non-monetary benefits such as fringe benefits differently, depending on whether the benefit is granted repeatedly or sporadically. If the employee is granted a non-monetary benefit repeatedly, taxes are withheld every pay period by adding the value of the benefit to the monetary amount paid. The amount of the taxes withheld is then reported on the earnings payment report using its own income type, 402 Withholding tax.

If the employee is granted a non-monetary benefit sporadically, taxes can be withheld during the same calendar year in two different ways:

• The employer adds the full value of the benefit to the monetary amount paid during the next pay period after the granting of the benefit, and withholds taxes from the total amount.
• The employer divides the value of the benefit to equal instalments, adds the instalments to the monetary amounts paid during the payment months following the granting of the benefit, and withholds taxes from the total amounts. All instalments must be added to amounts paid during the same calendar year.

The latter method must be used when the euro amount of the benefit is high and the monetary wages paid to the employee are insufficient for withholding taxes. If the value of a sporadic benefit is no more than EUR 400 per year, tax may be withheld once a year, no later than in connection with the withholding from the last monetary payment during the calendar year (decree on tax prepayments (Ennakkoperintäasetus 1124/1996), section 9). Even if the withholding is divided over the same calendar year as described above, the fringe benefit must be reported in full when the benefit was available for use or when monetary wages are paid for the benefit's accrual month.

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 if it meets the requirements for being tax-exempt laid down in law. 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 law or the decision of the Tax Administration on tax-exempt reimbursement for travel expenses. 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. Tax-exempt reimbursements of expenses can be reported by the fifth day of the month following the payment month. The payments can be reported on one report once per month, even if there are several payment dates for reimbursements of expenses during the same month. The date of the last payment of reimbursements of expenses during the month is then entered as the payment date on the report.

If an employee is paid reimbursements for commuting based on a document provided by a transport operator (such as a train ticket), and the requirements for paying tax-exempt reimbursements of expenses are met, these reimbursements are 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. 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 high.

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. Tax-exempt reimbursements of expenses related to work abroad mean tax-exempt reimbursements connected to work abroad as referred to in section 76(1)(5) of the act on income tax (tuloverolaki 1535/1992). The Type of daily allowance entry in question is used to report all tax-exempt expenses related to work abroad, such as flight expenses, road tolls and other expenses. This being the case, expenses based on a document provided by a transport operator are also reported using the Type of daily allowance entry in question if the expense items were related to work abroad pursuant to section 78 of the act on income tax.

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). Grounds for tax exemption are laid down in the Tax Administration’s decision on tax-exempt reimbursement of travel expenses. If the allowance 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. If a higher allowance is paid than what is laid down in the Tax Administration’s decision, the share in excess of the maximum amount must be reported using the income types for wages.

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.

2.1.5 Travel expenses as part of total wages

The employer and employee can enter into a total wage agreement, in which case the amount of income is the same regardless of whether the employer reimburses the employee’s expenses from work. The employer and employee can agree that tax-exempt reimbursements of travel expenses are part of the total wages agreed to be paid for work. Tax policy verifies (Supreme Administrative Court 2022:72) that, in this case, daily and kilometre allowances are tax-exempt income for the employee, if they have been paid in accordance with the Finnish Tax Administration’s decision on expenses and the employment contract. The amount of travel expenses is deducted from total wages before tax is withheld. The difference between the agreed total wages and tax-exempt reimbursements of expenses is reported as taxable income. In addition, the paid tax-exempt reimbursements of expenses are reported separately.

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 higher 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 kilometre allowance is not subject to a social insurance contribution, the payer must use the separate Type of insurance information entry to report that the income is not subject to the specified insurance contribution. For more detail, see the instructions Reporting data to the Incomes Register: insurance-related data. This kind of situation may occur when, for example, the employer pays an employee taxable kilometre allowances on more lenient grounds than the decision by the Tax Administration as based on a collective agreement and the amount of the allowance does not exceed the maximum amounts of tax-exempt payments specified in the Tax Administration's decision on expenses. The income is then not subject to earnings-related pension, unemployment, or accident and occupational disease 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 daily allowance and meal allowance  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 using the income type Other compensation 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 Taxable reimbursements of moving and travel expenses

Section 69 c of the act on income tax (tuloverolaki 1535/1992) entered into force in the beginning of 2020 provides that 50% of the moving and travel expenses of an employee and their family member paid by the employer is tax-exempt. The relief requires that the move takes place due to the location of the employee's place of work. Expenses directly related to moving are deemed to be moving expenses. These include, for example, expenses incurred from packing, unpacking and transporting property.

Trips between the old and new housing taken during the move are deemed to be trips directly related to the move. If a trip directly related to the move is taken in the employee's own vehicle, the employer may reimburse the trip against a travel invoice. In these situations, too, half of the reimbursement paid by the employer is tax-exempt income and half is taxable income. In these situations, no more than the maximum amount of tax-exempt kilometre allowance confirmed by the Tax Administration is deemed to be a moving expense referred to in the provision. If the employer reimburses more than the maximum amount of the tax-exempt kilometre allowance for the trip, half of the amount not exceeding the maximum amount of kilometre allowance confirmed by the Tax Administration is tax-exempt income. The part of the reimbursement exceeding the maximum amount is taxable earned income in its entirety. The requirements for tax-exempt moving and travel expenses are described in more detail in the Tax Administration’s instructions Taxation of Reimbursement of Business Travel Expenses. 

The part of the moving and travel expenses reimbursed by the employer that is taxable as earned income, or 50% of the expenses paid by the employer, are reported to the Incomes Register as earned income. These expenses are deemed to be the employee's and their family member's living expenses. The data is reported using income type Other compensation (216). In the situations described above, the income is subject to all social insurance contributions.   

The tax-exempt part of moving and travel expense reimbursements is not reported to the Incomes Register.

2.4 Reimbursement of travel expenses paid by public sector entities

The state or its governmental institutions, municipalities or joint municipal authorities, wellbeing services counties and joint 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.

2.5 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.

2.6 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.

The Deduction before withholding income type is used only when the employee is paid wages or an athlete's fee, the employee him/herself has paid direct expenses incurred from performing work, and these expenses are deducted from the wages before withholding taxes.

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 amount of the deduction reduces the earnings from work subject to social insurance contributions, even though the original amount of wages remains as taxable earnings. The maximum amount of deduction that can be reported is the amount of the payment.

The default for the income type Deduction before withholding (419) is that it is not subject to social insurance contributions. In certain situations, this insurance information must, however, be confirmed, even if it is in accordance with the default, to clarify the income from which the deduction has been made.

If the payer makes the deduction from income that is not subject to social insurance contributions, the payer must specify Type of insurance information: Subject to social insurance contributions: No for income type 419. However, the Type of insurance information does not need to be specified if the report only includes income that is not subject to social insurance contributions (see Example 49). Furthermore, the Type of insurance information is not specified if income subject to social insurance contributions is only reported (see Example 51). In these situations, the income from which the deduction has been made is otherwise clear. If part of the reported income is subject to social insurance contributions and part of it is not, No must always be selected as the type of insurance information for income type 419 if the deduction is allocated to income that is not subject to social insurance contributions (see Examples 48 and 50). In the same situation, if the deduction is allocated to income that is subject to social insurance contributions, the type of insurance information is not connected to income type 419.

If a single transaction includes the payment of wages subject to social insurance contributions and such wages in accordance with section 13 of the tax prepayment act (ennakkoperintälaki 1118/1996) that do not act as basis for social insurance contributions, and expenses which are deducted before withholding are allocated to either income, the payer must specify the Type of insurance information. This allows the deduction to be allocated to the correct income type.

If, in a single transaction, the payer deducts expenses from income subject to social insurance contributions and income from which no social insurance contributions are paid, the payer must report the deductions separately. Type of insurance information (Subject to social insurance contributions: No) must be specified for the deduction made from income from which no social insurance contributions are paid. Correspondingly, if the income from which the deduction was made was not subject to some individual social insurance contribution, such as the unemployment insurance contribution, the payer only needs to confirm that there was no obligation to provide this particular insurance.

If the deduction before withholding is made from income subject to all social insurance contributions, the payer does not need to specify the Type of insurance information unless the payer also pays some other income not subject to social insurance contributions in the same transaction.

2.7 Other reimbursements of expenses

Reimbursements of expenses related to non-wage compensation for work and compensation for use as well as the reimbursement of travel expenses paid by a non-profit organisation are described in the instructions Reporting data to the Incomes Register: rewarding employees, payments made to an entrepreneur and other special circumstances. Of particular interest in these instructions are Section 3, Payments made to companies and entrepreneurs; Section 4, Compensation for use and royalties; Section 5.1.2, Athlete's fee; and Section 5.11, Reimbursement paid by a non-profit organisation and public sector organisation to volunteers.

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.