Transfer tax when corporate stock is sold and purchased

When you buy corporate stock, you must file a transfer tax return and pay the tax (i.e. you buy shares of an entity that operates a business, i.e. not of a housing-company or real estate company). Examples of corporate stock include shares of a business enterprise or a telephone company. As the buyer, you are required to calculate and pay the transfer tax on your initiative. 

However, if the shares you bought are listed on the stock exchange and you bought them on the exchange, you generally do not have to pay transfer tax or file the tax return.

1

File the tax return

File the transfer tax return in 2 months from signing the contract.

  • If you buy together with a co-buyer – typically your spouse – both of you must submit a transfer tax return.
  • To complete the return, you should have the purchase and sale agreement or other contract on hand. In addition, other documents may have had an important role in your transaction. They may have a bearing on the way the transfer tax is assessed. 
  • However, you generally do not have to add very many enclosures. In MyTax, a window will appear that tells you whether an additional enclosure must be attached or whether it is enough if you just complete the tax return.

File in MyTax

How to file a transfer tax return in MyTax

The paper-printed form can be used by individual taxpayers, general partnerships and limited partnerships. If the paper form is filed, you must enclose a photocopy of the contract.

2

Pay the tax

File the transfer tax return and pay the tax in 2 months from signing the contract.

  • If you use MyTax to send the payment, reference numbers and other bank details are automatically transferred to the template for processing by your e-banking service. MyTax calculates the amount of transfer tax.
  • If you pay via your personal e-bank instead, you need the bank account number for the Tax Administration and the bank reference number for transfer tax. To get the bank account and reference numbers, you can:

When you fill in the amount, include two decimal points. If there is more than one buyer – two spouses, for example – each must pay their own share of the transfer tax on a separate bank transfer and enter their personal reference numbers. The amount will be displayed as a paid tax in MyTax on the following business day or the day after that.

3

You receive a certificate of transfer tax

You will receive a certificate on filed and paid transfer tax in MyTax or by post. Normally, after you have filed and paid, the certificate will appear in MyTax in 2 days. Finding the certificate in MyTax. 

If you file your return on paper, wait for the certificate of transfer tax to become available in MyTax a little later.

The amount of transfer tax on corporate shares

The tax is 1.6% on the price paid, or on the value of other consideration or compensation.

You can use the transfer tax calculator to help with your calculations.

If the buyer is a non-resident taxpayer

If the buyer of the corporate stock is a non-resident taxpayer (an individual from a foreign country, for example) and you are obliged to collect tax on the sale in question, you must file a transfer tax return on the tax you collected from the buyer, and then pay the amount on to the Tax Administration.

Examples of circumstances where you may be obliged to collect tax include a situation where you, a Finnish resident, sell shares of a Finnish business company (corporate stock) to a buyer who is a nonresident. In case there are several sellers, your obligation is simply to submit a transfer tax return and pay transfer tax only for the part that you yourself had collected. In the same way, you must only report your portion of the price and other compensation. In addition, you and your buyer can agree that the buyer, a non-resident taxpayer, will account for transfer tax himself: More information is available in “Transfer taxation relating to sales and transfers of corporate stock and other securities” (in Finnish and Swedish, section 7.2 and other sections).

If both the buyer and the seller are non-resident taxpayers, trading in corporate stock is not subject to transfer tax and there is no need to file a transfer tax return.

Note that if the transaction concerns other than corporate stock, such as shares in a housing company or real estate company, the buyer must register as a taxpayer with the Tax Administration and file and pay transfer tax. This rule also concerns buyers that are tax non-residents in Finland.

Frequently asked questions

You must file the return even if the transfer tax is less than €10.

If you buy listed shares outside of the stock exchange, you have 2 months of time to pay 1.6% of transfer tax on the sales price and other possible remunerations, and file a transfer tax return.

In the same way, if your employer gives you a stock grant as part of your compensation, you must file a transfer tax return and pay the tax.

Read more about situations where purchases of corporate stock are subject to transfer tax, section 8.13 (detailed guidance in Finnish and Swedish only).

When corporate stock or shares in business premises are sold and bought, the transfer agreement is often made in stages.

  1. First the parties sign an initial agreement known as the Share Purchase Agreement. Then they agree on the conditions that must be met before the parties are obliged to conclude the deal. The parties also typically agree that they will draft the final transfer agreement after the conditions are fulfilled.
  2. The parties sign the final transfer agreement, i.e. the Closing Memorandum.

If the initial agreement is a preliminary agreement, then the due date of the transfer tax return and tax payment is determined based on the final transfer agreement. Enter the signing date of the final transfer agreement as the date of sale.

If the final transfer agreement contains a suspensive or resolutory condition, it has no effect on the due date of the transfer tax return and tax payment. The due date is counted from the date of signing the transfer agreement.