Report rental income on your tax return
Always remember to include rental income on your tax return, if this information is missing.
If you have requested a tax card or prepayment in MyTax as of November 2018, the rental income will also appear on the tax return. Remember to check the information on the tax return and correct it if needed.
You can report rental income for 2018 directly on your tax return in MyTax.
If you do not file your return online, you can use these paper forms:
Keep the receipts
Keep hold of your receipts and only send them to the Tax Administration if specifically requested. Do not enclose receipts with the forms.
Keep records of your rentals, including all the information and receipts required for tax purposes. You must keep the records for 6 years, starting from the beginning of the year after the end of the tax year.
Remember to pay tax on rental income
Check whether your rental income is covered by your tax card or prepayments. If not, request a new tax card or prepayment in MyTax. This way, your taxes are kept up to date and you will not have to pay back taxes later.
You can also supplement your prepayments after the tax year by requesting additional prepayment. You can request and pay additional prepayments in MyTax up until the end of the tax assessment process.
Make sure you report your rental income correctly
If your tenant pays their rent in advance, any amounts you receive before the end of the year count towards your taxable income during that year.
Example: Antti only paid Pekka for 11 months’ rent in 2018, as Pekka did not receive his December rent until January 2019. Pekka declares his rental income according to 11 months in his 2018 tax return. If Antti pays all the rent due in 2019 (12 months) during 2019, Pekka’s rental income in 2019 will be based on 13 months’ rent.
If you co-own a rental property, you only need to report your share of the rental income and any associated costs. For example, if you co-own a buy-to-let property with a partner, each of you should only report half of the rental income and deductions.
Example: Sanna and Pasi are a married couple who co-own a flat that they have let to a tenant called Matti Meikäläinen. Matti’s rent is €800 per month, which gives Sanna and Pasi a joint annual rental income of €9,600. The maintenance charge on the flat is €130 per month, or €1,560 per year. Their other expenses from the rental amount to €180 in total. Sanna needs to report her share of the rental income (€4,800.00) and the associated expenses (€780.00 and €90.00). Pasi needs to do the same.
If you are an owner of multiple flats, apartments or other rental property units, you must break down the income and expenses specifically for each one on your tax return.
Example: Rental income from property A (after deducting expenses) amounts to €4,500 and rental income from property B to €4,000. Property C has made a rental loss of €2,000.
The rental income and expenses for each property need to be entered separately. The taxable rental income amounts to €8,500 in total and rental losses to €2,000.
If you charge rent from your own business, you need to declare it as rental income in your tax return. Rent must be charged at market value.
Business or agricultural income may include rental income, such as rent on farmland. Such rental income does not constitute capital gains in its own right and is instead included in what is called divisible business income.
Rental income from business or agriculture must be declared as agricultural or business income.
If you co-own a property with a partner other than your spouse, the Tax Administration treats you as a real estate partnership. Rental income from co-owned property must be reported on the real estate partnership’s tax return, not your individual tax return. The real estate partnership’s profit or loss is split between the owners and taxed as their personal income.