Finland VAT guide
Finland VAT guide for businesses
Finland introduced Value Added Tax (VAT) in 1994 with a standard rate of 22%. The current standard VAT rate is 24% but it will increase to 25.5% in 2025.
The official Tax Authority of the country is Verohallinto, founded in 1970.
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What is the VAT rate
in Finland?
24%
The standard VAT rate is current 24% in Finland but it will increase to 25.5% in 2025.
A reduced VAT rate of 14% can be applied for product such as groceries, feed, restaurant and catering services, however it is not applicable for alcohol and tobacco products.
Items previously taxed at 10% will now be subject to a 14% VAT rate is applicable for a number of products, e.g. Books, newspapers, pharmaceutical products, accommodation services, passenger transport, etc.
Some items are eligible for applying 0% VAT, such as the sale, rental and chartering of VAT-exempt vessels and work performed on such vessels, tax-exempt sales of member’s magazines and advertisements to non-profit corporations, tax-exempt sales relating to warehousing procedures (tax warehouse in VAT), exports outside the EU, etc.
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Deadlines
In Finland, for monthly and quarterly VAT returns, the submission deadline is the 12th of the second month following the end of the tax period (i.e. VAT return for March should be submitted and paid by 12 May).
For yearly returns, the submission deadline is the end of February of the following year.
If the deadline falls on a weekend or public holiday, the submission is due with an extension on the following working day.
EU VAT recapulative statements should be filed on the 20th day of the month following the period end. The Intrastat declaration should be submitted by the 10th working day of the month.
Requirement to register for VAT
If the taxable turnover of a business is more than EUR 15,000, the business has to register for VAT. Voluntary registration is also possible for businesses with taxable turnover that is less than EUR 15,000.
Certain activities are exempt from VAT perspective, and do not require VAT registration, but in some cases voluntary registration is available (e.g. Medical services, social services, general postal services, etc).
Registration usually takes up to 3 weeks to be processed. If the company already has a Business ID in Finland, the registration can be completed through MyTax portal. The Business ID is issued when the business gets established.
VAT filing frequency
The filing frequency of VAT returns can be monthly, quarterly or yearly.
Submission
VAT returns and EU VAT Recapitulative Statements should be submitted online, through the MyTax portal. Paper form submission of returns are only accepted in exceptional cases. Intrastat declasarions are submitted online through the Customs website, using an ASCII or CSV uploader file.
Invoicing requirements
There are certain requirements regarding the content of an invoice, which includes:
- Date of issue
- A unique sequential number
- Supplier VAT ID
- Customer VAT ID
- Names and addresses of the seller and the purchaser
- Quantity and nature of the goods supplied, or the extent and nature of the services supplied
- The date of the supply, or the date of prepayment
- Base of VAT per VAT rate or exemption, unit price exclusive of VAT, and any discounts or rebates not included in the unit price
- VAT rate
- VAT amount payable
- In the case of an exemption, reference to it, or reference to the applicable provision of the Finnish VAT Act, or to that of the VAT Directive
- Where the purchaser is liable for the payment of the VAT, the mention “Reverse Charge”
- Where the purchaser, instead of the seller, issues the invoice: the mention “Self-billing”
- Information on a new means of transport
- Where one of the special arrangements applicable to second-hand goods, works of art, collectors’ items and antiques is applied, the mention “Margin scheme – Second-hand goods”; “Margin scheme – Works of art” or “Margin scheme – Collector’s items and antiques”, respectively
- Where the margin scheme for travel agents is applied, the mention “Margin scheme – Travel agents”
- Where taxable investment gold is being sold, mention of it
- If the invoice is a correction or change to a previous invoice, reference to that invoice.
In case the amount is less than EUR 400, a simplified invoice can be issued (except for intra-Community supplies of goods and distance sales of goods)
Agents and fiscal representatives
Finnish businesses have the opportunity to appoint an agent to act on their behalf regarding their VAT compliance, however it is not compulsory. In case the business decides to give authorization to an agent, it can be done online on Suomi.fi.
It is not compulsory to have a fiscal representative in Finland for VAT purposes, however it might be required in some cases for non-EU companies.
IOSS
The Import One Stop Shop was introduced on 1 July 2021. It can be used for international consumer sales, allowing sellers to report VAT in a centralised manner in a single EU Member State. The IOSS covers services sold to private consumers in the EU and distance sales of goods to EU consumers. Registration for IOSS is voluntary, however if a seller does not register for IOSS, it will have to register for VAT in all the countries where consumers purchase the goods or services provided by the seller covered by the special scheme.
In Finland, the registration for IOSS can be submitted via MyTax portal, and once the Tax Authority has processed the registration, a decision letter will be sent also through MyTax portal.
VAT relief scheme
Finland offers VAT relief for small businesses, who are registered for VAT and have had a net sales of €15,000 or less for a period of 12 months. Furthermore, if the company’s net sales have been more than €15,000 but less than €30,000, there is a possibility for partial relief.
To submit the request for VAT relief, the company has to provide the amount of net sales and VAT qualifying the relief (not all sales and taxes can be taken into account for this). The VAT relief request can be submitted along with the VAT return, and the e-service will automatically deduct the relief amount from the payable VAT amount.
It is important to note that the amount received as VAT relief is taxable, and has to be included in the company’s accounting as income received.
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