The usual country of taxation for Finnish-sourced pension income will be Finland even if the beneficiary lives in another country. However, if you move from Finland to live in Spain, special tax rules apply.
The tax treaty between Spain and Finland includes clauses that in some cases may prevent Finland from levying tax on Finnish national old-age pension and employment pension earned in the private sector.
Report your foreign-sourced income along with any Finnish-sourced income with a Finnish tax return
Tax Return on the Web (tax.fi/taxreturn)
Go to online service
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.
When a Finnish citizen leaves Finland for another country, they continue to be a tax resident of Finland during the calendar year when they leave and for three years after the end of that year.
Country of taxation is Finland for pension earned in the service of state or municipal authorities
If you have been employed by the Finnish state or a Finnish municipality and earned pension income, this will be taxed in Finland even if you lived in Spain on a permanent basis. However, if your employer was a public entity that operates a business – such as VR, the state railways – the pension income may be taxed in Spain. Spain would also be the country of taxation if you were to become a citizen of Spain.
Under what circumstances would the taxes for private-sector pension income be payable in Spain?
If you were employed by a private sector enterprise, your pension will only be taxed in Spain if you live there on a permanent basis. The authorities would generally consider your residence in Spain to be permanent if you no longer retain a home in Finland. If you still have living quarters in Finland, it will be more complicated to determine where your pension income is to be taxed. If it is your habit to stay in Finland for long periods, and to spend time in Finland in the winter season, the usual practice has been that Spain cannot become the country of taxation, at least not for the first three tax years.
If the taxpayer has given sufficient details to the Finnish tax authorities, the taxation of private-sector pension will be effected in Spain, and not Finland, if all the following conditions are met:
- You have filed a notice of moving away from Finland to live in Spain. This notice is filed with the Population Register Centre (väestörekisterikeskus; befolkningsregistercentralen).
- You have obtained a permanent place to live in Spain.
- The Spanish tax authorities consider you a Spanish tax resident. Note that if this is the case, your other income sourced in Finland may be taxed in Spain.
Ask the Finnish Tax Administration for a tax card
If you want to have Spain as the country of taxation of your pension income, you may ask for a Finnish tax-card calculation taking this into account. Fill in Form 6207a. Mandatory enclosures include an certificate of residence and tax liability from your home country. You should enclose a sufficient explanation on your living quarters in Spain – the deed of sale-and-purchase, or alternatively a contract of lease. You should also enclose proof that you have relinquished the permanent home that you have previously had in Finland. Acceptable proof includes documentation showing that you no longer have a rented home in Finland, or if you have sold your owner-occupied home, a deed of sale-and-purchase, or alternatively an explanation that you have rented out your owner-occupied home to a tenant.
Health care contribution still payable in Finland
Even if you were to live in Spain on a permanent basis, Finland would reimburse the Spanish tax authorities for any medical costs that may build up. For this reason, you would continue to pay the Finnish health insurance contribution, which amounts to approximately 1.5% of your gross pension amount. The applicable legal statute that governs the reimbursement system of health costs and medical costs is the Council Regulation (EU) no. 883/2004 on the application of social security schemes to employed persons.
Checklist for pension recipients leaving Finland
File a notification of move to the Local Register Office.
- If you do a permanent change of address the Tax Administration receives information from the Local Register Office automatically.
- If you do a temporary change of address to the Local Register Office, you must file a separate change-of-address to the Tax Administration.
- If your foreign address information were to change, you must inform both the Local Register Office and the Tax Administration to keep the files up-to-date.
- When a Finnish citizen leaves Finland for another country, they continue to be a tax resident of Finland during the calendar year when they leave and for three years after the end of that year.
Contact the local tax authority to find out what your tax obligations are