Performing artists, sportsmen and athletes from other countries
If you are a foreign artist or sportsman, and you give a performance or participate in a sports event in Finland, the fee that you receive will normally be subject to Finnish tax.
For the purpose of these instructions, 'performing artists, sportsmen and athletes' does not cover such professionals as directors of theatrical performances, choreographers, theatrical set decorators, referees and coaches.
Duration of stay maximum 6 months: tax at source
A fee paid for a personal endeavour will be subject to Finnish tax. Tax at source will be withheld on payment at the rate of 15 per cent regardless of whether the compensation is characterised as wages or any other type of income. Withholding will apply even to situations where payment is routed to an overseas management office or other corporate entity. No tax deductions are available, and consequently, any fee paid to an agent cannot be subtracted from the pre-tax amount. However, even if the compensation itself remains fully taxable and no amounts can be deducted, your employer can generally cover your hotel costs, travel tickets and freight expenses directly if you have documents and receipts that show the relevant amounts. Reimbursement of direct costs is exempt from tax. Furthermore, your employer may pay you a per diem allowance, which is also exempt under the Finnish domestic rules governing travel costs.
Because the tax withheld at source is a final tax, you will not be expected to submit a Finnish income tax return. At the end of your contract, your employer will give you a document showing details of your gross pay and the withheld taxes. You should keep this document, as you may later need to show it to the tax authorities of your country of residence for the purposes of eliminating international double taxation.
Artists and sportsmen resident in EU/EEA: selection of the optimal tax scheme
If you are from an EEA country you can select a progressive tax rate, allowing you to subtract direct costs from your gross income (for example, travel and hotel costs for which the employer has not paid tax-exempt compensation). You can request the tax office to examine your case and issue a progressive rate tax card where these costs are accounted for in the tax rate. Check the If you stay longer than six months, you will be considered a Finnish tax resident. Artists and sportsmen who are residents are taxed under the same rules as other residents. Implementation of the brackets of the progressive scale will mean your tax rate will be determined by your annual gross income.
If you have a Finnish employer, you will need a tax card (the employee's withholding allowance certificate), which you can request at the local tax office. Show it to your employer. If your employer is not Finnish, and does not withhold any amounts from your pay, we recommend that you submit a request to the tax office for self-initiated tax prepayments. To obtain a tax card or register for tax prepayment you will need a Finnish personal identity number.
Remember to file a Finnish income tax return
Those staying longer than six months in Finland must file a tax return. The Finnish Tax Administration will send you a pre-completed tax return form in the spring following the year when you worked in Finland. Check the information printed on the pre-completed tax return form. If there is no need for corrections or additions, you do not have to do anything.
If needed, you can make changes or corrections to your tax return in MyTax.
Impact of international tax treaties
The tax treaties that Finland has made with other countries do not normally have a restrictive effect on Finland's taxation rights in respect of the fees paid to foreign sportsmen or artists who have been personally active in Finland. The sole exception to this rule is artists and sportsmen arriving from the United States of America. In this case fees paid and reimbursement for expenses up to U.S. $20,000 per year for your personal endeavour will not be subjected to Finnish tax. However, if the threshold of U.S. $20,000 is exceeded, the entire amount will be taxed in Finland. The payer can take into account the tax treaty relief only if it is marked in the tax at source card.
Example: The Finnish organiser is paying €25,300 as a total fee to a group of five artists from the United States who will give two performances. Because the amount is higher than U.S. $20,000, a tax of 15% would normally be withheld at source. However, if a detailed specification is submitted to the tax office showing the portions of the fee that go to each individual artist, and the relevant pay slips and Employer Payroll Reports are prepared showing the names of each artist separately, no taxes at source will be withheld on the payment made to the individual artist, unless that artist's fee and reimbursement exceeds the threshold of U.S. $20,000.