Pre-assessment tax base for 2018, individual taxpayers
The final assessment of all taxpayers' taxes for 2016 serves as the base for the decisions that define the required total prepayments for tax year 2018. However, the following adjustments were made to the values from 2016:
- Estimated income from business sources of income is increased by 10.0%
- Estimated rental income is increased by 5.0%
- Estimated wage income, including tip income within certain service professions, is increased by 2.0%, and if income figures for 2017 have been available it is increased by 1,0%.
The calculations contain no further upward adjustments in addition to the above.
If any changes to your prepayments were made during 2017, the income figures for 2017 have thus been available to us and we have made use of them. In the same way, you may have submitted an estimate of your 2018 income, and in that case, we have made use of it as well.
- For calculations on capital income and earned income, derived from business and farming, the Tax Administration database on assessment for 2016 serves as the base, and alternatively, if changes in prepayment were carried out in 2017, the income figures have therefore been available and calculations are based on them.
- No income estimates for receipts of surplus on cooperative capital and dividends are included in the calculation of the required withholding, via the tax card, unless changes to pre-assessment were made in 2017, or unless the taxpayer submitted an estimate for 2018 that contained:
- Dividends from Finnish payers
- Dividends from stock-exchange-listed foreign payers
- Receipts of a cooperative's profit surplus
- Payers must withhold 25.5% on the dividends of a stock-exchange-listed corporation.
- Payers must withhold 7.5% on the dividends of a company not listed by a stock exchange. For amounts exceeding €150,000 the payers must withhold 28% on the excess part. When payers withhold tax, the percentage rate applies to the entire amount, not just to the taxable portion of the dividends. If you expect to receive dividends distributed by other than stock-exchange listed corporations, we recommend that you ask for a revised tax card to ensure that your withholding is correct When you ask for the card you should let us know the gross amount of your dividends, divided into two parts; one of which is taxable as earned income, the other — as capital income. Report the part representing 8% of the mathematical value of the shares you hold as the capital-income part. The dividends in excess of 8% of the mathematical value, if paid out, will be taxed as earned income. Further information about the taxes on dividends (in Finnish and Swedish only)
- Payers must withhold 25.5% on the profit surplus distributed by a stock-exchange-listed cooperative society.
- For other cooperative societies, the rate of withholding is 7.5% on the condition that the annual total income consisting of profit surplus is max. €5,000 distributed by the same cooperative. If the annual total goes over this threshold, the rate of withholding is 25.5% on the amount going over it. It is the cooperative society's obligation to keep track of whether its distributions to a single beneficiary go over the threshold. If you expect to receive profit surplus distributed by other than stock-exchange listed cooperatives, we recommend that you ask for a revised tax card to ensure that your withholding is correct.
Healthcare contributions of self-employed individuals
Healthcare contributions are the two following payments: healthcare payment (Finnish: sairaanhoitomaksu) and the daily-allowance contribution payment (Finnish: päivärahamaksu). The healthcare payment is based on the annual earnings amount reported to the insurance company, because in the case of self-employed business, the payment cannot be based on wages. If the individual concerned is additionally employed by another employer and is paid wage income, all incomes are accounted for in the official decisions that define the total prepayment for 2018. If there are tax deductions, they are included in the calculation as based on the total income, and the result is the net taxable income. Recipients of academic grants, insured as provided in MYEL laws, have the grant included in their income base for healthcare contributions. The health care contribution on wage income and annual earnings, reported to an insurance company, equals 0%.
For wage earners – individuals who are not self-employed or MYEL insurance carriers – the base for healthcare contribution, 1.36%, is the taxable income for purposes of municipal income tax. Some taxpayers are recipients of pension, social benefit or other income, which is exempted from the daily-allowance contribution, but includible in the healthcare payment base. For this reason, the rate of the healthcare payment is raised by 0.17% for these taxpayers.
The daily-allowance contribution rate equals 1.53%, and if the taxpayer is not a wage earner, the annual earnings amount reported to the insurance company is used as the base. In the case of self-employed business insured under the YEL laws, the applicable rate of the daily-allowance contribution payment is increased by 0.17%. This contribution is not collected from the taxpayers whose wage income plus "annual earnings" stays below €14,020 a year.
Applicable prepayment rates
- State income tax schedule, 2018
- Income tax rates valid in various municipalities and church parishes, 2018
- Nonresidents' municipal income tax rate 19.75%
- Healthcare contribution payment 0%/1.36 % + 0.17%
- Daily allowance contribution 0%/1.53 % + 0.17%
- Public Broadcasting Tax 2.50%
- Capital income is taxed at the rate of 30%. For any part that goes over €30,000, the rate is 34%.