Pension from Sweden
If you receive a pension from Sweden, the pension will be taxed in Sweden. However, the pension will affect your taxation in Finland.
The Nordic tax treaty changed at the beginning of 2009. The change does not apply to you, if you lived in Finland on the signing date of 4 April 2008 but received a pension from Sweden. The 'exemption method' will then be applied to the taxation of your Swedish pension. If you also report pension or earned income received from Finland, the tax rate in Finland is calculated based on all your income (income from Finland + income from Sweden). However, you will pay tax in Finland only on the income received from Finland. The exemption method is applied for as long as you reside in Finland without interruptions.
If you did not move to Finland or start receiving Swedish pension until after 4 April 2008, the 'credit method' is applied to the taxation of your pension. The pension from Sweden will be taxed in Finland, but the Swedish tax will be credited, i.e. deducted from the Finnish tax. The deduction may not be greater than the tax imposed on the Swedish pension in Finland.
Swedish pension and Finnish tax return
Keep safe the document you receive on your pension (Kontrolluppgift) from the Swedish pension provider at the beginning of the year. You will need it in April when you check your Finnish tax return. The pension you have received from Sweden and its effect on your tax assessment in Finland are usually indicated on the Finnish tax return and tax decision.
When you receive a Finnish tax return, this is what you should do:
If you do not file electronically, fill out paper Form 16A Statement on foreign income (earned income)
If no corrections or additions are required, you need not do anything.
Swedish pension on the tax card
Contact a local tax office when you move to Finland or when you start receiving pension from Sweden. The tax office will give you a tax card for the Finnish pension after calculating the Swedish pension's effect on the tax rate. When your Finnish pension is taxed at a higher rate during the year, you will avoid back taxes and potential interest.
Health care contribution
Finnish residents taxed in Finland must pay a health care contribution, which is less than 2% of the income. If you receive pension income from Finland and from Sweden, the contribution is imposed on the total amount. The contribution cannot be greater than the pension you receive from Finland.