Finnish citizens and the 3-year rule

If you are a citizen of Finland and you leave Finland to live in a foreign country, you will normally continue as a Finnish tax resident during the tax year of your relocation, and for the three following tax years (this rule is known as the three-year rule).  

During this period, your tax residency cannot normally be changed to Finnish tax non-residency unless you make a specific request and can demonstrate that during the relevant tax year you no longer have any economic and social ties that connect you with Finland. 

If overseas stay is temporary 

If you plan on living overseas for 2–3 years and then coming back to continue living in Finland, your tax residency in Finland will normally be valid for the entire period.  Even if your permanent home for tax purposes were not located in Finland during this period, you would continue to be a Finnish tax resident because you did not move away permanently. 

If overseas stay is permanent  

The tax authorities will appraise the strength of your economic and social ties with Finland more thoroughly if you declare that you are moving away on a permanent basis.  Such appraisal will cover all the relevant facts and circumstances, with each case decided on its merits.  However, as a general rule of thumb, the authorities will usually conclude that strong ties continue to connect you with Finland (for tax purposes) if any one of the following conditions still applies:

  • You continue to have a permanent home in Finland.  
  • Your spouse continues to live in Finland. 
  • You continue to own a unit of real property in Finland other than a summer cottage.  
  • You continue to be covered by the Finnish social security system.
  • You operate a trade or business in Finland.  
  • You perform work, labour or personal services in Finland.  

The presence of your spouse will no longer be deemed a strong social tie if you and your spouse have separated.  Similarly, your continued ownership of a summer cottage in Finland will not be deemed a strong social tie if your only Finnish-sourced income is pension income.  However, the appraisal will change if you continue to own other assets, for example a rented-out unit of a Finnish housing company.