Researchers and teachers from other countries
If arriving in Finland from certain countries, researchers and teachers are entitled, through the relevant tax treaties, to have their income exempted from Finnish income tax. This exemption may be valid even if the duration of stay in Finland is longer than six months.
There is variation in the provisions of the tax treaties with the countries concerned. Precise information on the country-specific exemption rules is available at the local tax offices in Finland. The researcher or teacher should obtain a Finnish tax card. Exemption can only be granted if you have a Finnish tax card on which the exemption has been recorded. If you have arrived in Finland as a researcher or teacher, and the tax treaty between Finland and your country of tax residence does not grant exemption, your income will be taxed under the generalised rules. For more information, click Töihin Suomeen. We would in any case recommend that you contact the local tax office.
Egypt, Spain and Japan: Exemption for researchers or teachers will only be granted if the duration of stay is maximum two years.
Researchers or teachers from Egypt and Spain are further expected to have arrived on the basis of an invitation sent by a Finnish scientific research institute or a Finnish institute of higher education. Exemption in the case of Egypt and Spain concerns only the income derived from work as specified by the text of the invitation letter and does not extend to other receipts of income.
United Kingdom: Exemption from income tax is granted to a professor or teacher (but not to a researcher) on the conditions that the duration of stay is maximum two years, and that he or she shows a UK certificate of tax assessment to the Finnish tax authorities.
France: Exemption is granted to researchers or teachers from France for the first two years, even if the total duration of stay and work in Finland is longer than two years.
Duration of stay maximum 6 months
If your stay in Finland is temporary, your wages will generally be subject to tax at source, assessed at the rate of 35 per cent. You should always contact the local tax office to request a tax card. If you are eligible for an exemption from Finnish income tax, the authorities will record this in your tax card. If you are not eligible for an exemption, the authorities will enter an instruction for your employer to deduct €510 per month – or €17 per day – from your pay. This deduction is called lähdeverovähennys; källskatteavdrag (deduction for taxpayers of tax at source). The remainder of your pay is subject to 35-per-cent withholding. Because your tax is a final tax you will not be expected to submit a Finnish income tax return. At the end of your temporary work period, your employer will give you a document showing your gross pay, the deducted amounts, and the withheld taxes. We recommend that you keep this document, because you may later need to show it to the tax authorities of your country of residence for the purpose of eliminating international double taxation.
As an option, you can request that your income be taxed under the progressive scale if you are a resident of a country within the European Economic Area or of a country that has a bilateral tax treaty with Finland. This means that instead of the usual final tax – withheld at source on your income at a flat rate – your tax would follow a progressive scale. For changing into this regime, you must visit a tax office and ask for a nonresident's tax card.
More information: Taxation of the earned income of nonresident individuals: Tax at source or Progressive tax
Duration of stay longer than 6 months
If you stay longer than six months, the authorities will consider you a Finnish tax resident, fully liable to pay tax. Your annual gross income will be assessed according to the progressive scale. The bracket of that scale will determine the percentage of your tax rate. If you are nonetheless eligible for an exemption from Finnish income tax, the authorities will record this on your tax card. To submit a request for a tax card you will need a Finnish personal identity number. For more information, click Finnish personal identity codes for short-term use.
Remember to file a tax return. In April, during the calendar year after your working and receiving income in Finland, the Finnish Tax Administration will send you a Pre-completed tax return form. Check the contents of the form, correct the pre-printed facts or information as necessary and send it back. If you have nothing to add or correct regarding your previous year’s taxes, you do not need to return the form.
If for some reason you did not demand exemption during the income year, you may do so when you return the pre-completed tax return form.
Exemption does not apply to social security contributions
The international tax treaties and exemption rules are not intended to cover the obligation to pay social security contributions. If you are covered by the Finnish residence-based social insurance system on the basis of working or living in Finland you will be expected to pay health insurance and social security contributions, even if you are exempt from paying tax.