How to pay tax on rental income
Rental income is automatically taken into account in your tax rate or prepayment amount based on your rental income in previous years. If you have paid taxes on your rental income previously, and there have been no changes to the income or the deductions you make from that income, you do not need to do anything.
If there are changes to your rental income, you must request a new tax card or changes to prepayments. If you are receiving rental income for the first time, report your rental income for your tax card or request prepayments.This way, your taxes are kept up to date and you will not have to pay back taxes later.
Alternative 1: Request a new tax card or raise your tax rate
You can raise the tax rate on your wages or pension to also cover the tax on your rental income.
There are two ways to raise your tax rate:
- Order a new tax card in MyTax
See the guidance for using MyTax: How to order a tax card in MyTax
- You can give your new tax rate directly to your employer or pension provider. You do not need a new tax card if you raise your tax rate.
Use the Tax percentage calculator to estimate your withholding tax percentage rate
Alternative 2: Pay taxes as prepayments
You can ask the Tax Administration to calculate prepayment instalments for you. You will receive payment instructions with your prepayment decision. Your prepayments will be split into two or more instalments during the tax year as shown in the decision.
You can also use the service to request a tax card for your wages. See the guidance for using MyTax: How to request prepaymentMore information about prepayments
Report changes in your rental income promptly
If there are changes to your rental operation, make the necessary corrections to your tax card or prepayments as soon as possible.
Request changes to tax card, changes to prepayments or cancellation of prepayments
- if your rental income increases or decreases
- if you no longer rent out your property.
If you stop making prepayments without notifying the Tax Administration, you will be sent a reminder. After this, any outstanding tax debt will be collected through enforcement.
Declare rental income in your tax return
Also always remember to declare rental income in your tax return. The information is not automatically carried across to your tax return from your tax card or on the basis of your prepayments.