If you stay longer than six months in Finland you are usually required to pay Finnish tax. In most cases, you are also required to pay social insurance contributions. But your income will not normally be taxed in Finland if you stay six months exactly, or for less than six months — and are employed by an employer of another country than Finland.
Nevertheless, if your overseas employer operates a trade or business in Finland and has a permanent establishment, your wages will be subject to taxes in Finland as if you had a Finnish employer. For detailed information, click Arriving in Finland to work for a Finnish employer. If you work in Finland as a leased employee from Estonia, Latvia, Lithuania, Poland or the Nordic countries, click Foreign leased employees.
Tax Return on the Web (tax.fi/taxreturn)
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The e-Service has opened 8.3.2018 for the taxpayers whose personal deadline date for filing a tax return is 3.4.2018 (self-employed traders and self-employed professionals). For other taxpayers, the opening date is at the end of March.
If you stay longer than six months you are liable to Finnish tax
Under these circumstances you become a tax resident of Finland, fully liable to pay tax. The calculation of the six-month period will not be affected by any short trips to other countries (or if you spend your holidays in your home country). Once you are fully liable to tax, your worldwide income will be taxable, in other words, you pay tax to the Finnish Tax Administration not only on your Finnish-sourced income but also on your income sourced in any other country.
The progressive scale will be implemented to compute your Finnish income tax. This means that the amount of tax will be proportionally higher as your income grows. However, you will be entitled to tax deductions according to the rules that apply to all Finnish taxpayers.
The Finnish authorities do not usually require that employers from foreign countries withhold any amounts on the wages paid out to workers in Finland. Instead of having your employer withhold tax every payday and pay it forward to the Finnish Tax Administration, you will be expected to take care of this obligation yourself. During the year or years when you work in Finland, you should make regular prepayments of income tax to the Finnish tax office. You should thus contact the Finnish Tax Administration and request a calculation of prepayments. It is important to take care of this, because the liability to pay Finnish tax will only grow bigger if you do not pay the prepayments. The alternative is that afterwards, you end up paying the whole amount plus interest.
The tax office will require that you apply for a Finnish personal ID number. You can file the request at the tax office (this will save you a trip to the local register office). When the calculation is complete, the tax office will hand you an official decision and your bank slips with due dates. Then you are supposed to make the payments as scheduled. For more information, see Tax Percentage Calculator.
Finnish income tax return
To report your taxable income and tax-deductible expenses, you should submit a tax return to the Finnish Tax Administration. The income to be declared will include both your Finnish-sourced income and any income sourced overseas. The Finnish tax return is a pre-completed form with information received directly from third parties including employers, other payers of income, and many other sources of information. You will receive the envelope at your registered address in April, the year after you have worked in Finland and earned income. The pre-filled lines will show any wages paid to you by Finnish employers, and the taxes they have withheld and forwarded. However, no pre-filled amounts will be showing if your employer is from another country. In this case, you should complete the form carefully and return it to the Finnish Tax Administration. However, if you have nothing to add or correct regarding your previous year's income or taxes, you do not need to return the form.
The Finnish Tax Administration will process any corrections originating from the taxpayer or third parties. Before the end of October, you will receive a new official Decision, Notice, and Bank forms. If no corrections are made, the Decision and Notice of Assessment (that you first received in April) will be final. If you need to pay a residual amount of tax, use the enclosed bank-transfer slip. If you are not satisfied with the tax outcome, read the instructions for appeal that are enclosed.
If no pre-completed tax return form arrives at your address by mid-May of the year following your year of work in Finland, you are required to complete and submit an income tax return form on your own initiative. Click form 3001e to download the form.
You should also file a Finnish income tax return form independently (without waiting for the pre-filled information to arrive) in cases where you become a recipient of Finnish-sourced income when you are no longer in Finland. If income is Finnish-sourced, based on work performed in Finnish territory, you should declare it fully and be aware that it is also subject to Finnish tax. Typical examples include holiday pay, which may be paid to the employee in arrears, and an employee benefit in the form of stock options.
Mandatory insurance contracts
In addition to taxes, you will also be expected to pay Finnish health insurance, pension and unemployment insurance contributions, which amount to approximately seven per cent of gross wages. However, if you are a holder of the A1 or E101 certificate showing that you are a 'posted employee' you will not be required to pay these contributions in Finland because your home country will continue to cover you within its social insurance system. It should be noted, however, that the provisions of an international tax treaty between Finland and your home country usually do not affect Finland's rights to demand these contributions from overseas workers.
For more information, visit the websites of the Finnish Centre for Pensions (etk.fi), of pension insurance companies, and of the Finnsh Unemployment Insurance Fund (tvr.fi).
Impact of an international tax treaty between Finland and your home country
In certain cases the income you receive from your overseas employer will not be taxed in Finland even if your stay is longer than six months. This is because the international tax treaty between your home country and Finland may prevent Finland from taxing your income under certain conditions, for example, staying in Finland for a maximum of 183 days within a time period specified by the tax treaty.
If your overseas employer is a public body, the normal procedure is that Finland will not be the country of taxation – your home country will continue to collect tax on your income. Public bodies are typically considered to be the central and local governments. However, if you have other income in Finland, you will normally be taxed in Finland. If you stay longer than six months, you will need to file a Finnish income tax return.
End of stay in Finland
When you no longer work and are moving away from Finland, you will be expected to submit a notification of move, to ensure that you file your final income tax return if necessary, and to arrange for the Tax Administration to stop sending you invoices for tax prepayment. For more information, click Foreign employee moving away from Finland.
No more than six months in Finland
If your continuous period of stay in Finland is six months exactly or less, you will be considered a nonresident. The wages you receive from an overseas employer will not be subject to Finnish tax. Similarly, if you have other foreign-sourced income besides your wages, this will also not be subject to Finnish tax.
If your overseas employer's business operation gives rise to a permanent establishment being formed in Finland, your wages will be taxed in the same way as if the payer of wages were a Finnish employer. Furthermore, in some special situations, your wages as a leased employee, performing artist, or sportsman or athlete will be taxed in Finland. For more information, click Performing artists, sportsmen and athletes from other countries.
Even if the Finnish tax authorities do not collect tax on your income, you will be expected to to pay Finnish health insurance, pension and unemployment insurance contributions, unless you are a holder of the A1 or E101 certificate showing that you are a 'posted employee'. However, if the duration of your work and stay is shorter than four (4) months, you will not be required to pay health insurance contributions.