Accounting Rules

Tax Year: From January 1st to December 31st
Accounting Standards: The Finnish Generally Accepted Accounting Principles (GAAP) is a commonly used accounting standard in Finland. Companies that are quoted in the stock-exchange have to use the IAS/IFRS standards (EU obligation since 2005).
Accounting Regulation Bodies: The European Federation of Accountants
Chamber of Commerce
Accounting Reports: The accounting report is made annually. In the report intangible assets can be shown in the balance sheet or in expenses in the profit and loss account (choice of the company). Physical fixed assets must be estimated at the original or production cost. Current assets have to appear at the lower cost and value of the market. Stocks are estimated at the weighed average cost or by the FIFO method.
Publication Requirements: Law refers to the notion of "good accounting method" as regards the methods of companies for the elaboration of financial status. All companies have to send a copy of their annual report to the legal authorities of the country. This annual report must contain a profit and loss account, a balance sheet and an annual report.
Professional Accountancy Bodies: KHT-yhdistys ry , The Finnish Institute of Authorised Public Accountants
HTM-tilintarkastajat ry , Association of Accountants (in Finnish only)
Association of Finnish Accounting Firms , Association of Finnish Accounting Firms
Certification and Auditing: Companies have to seek a statutory auditor to conduct an annual audit of the financial health of their organization. You can contact the Central Chamber of Commerce and Local Chambers of Commerce.
Accounting News: Accounting news (in Finnish only)

Tax Rates

Consumption Taxes

Nature of the Tax: Value Added Tax (VAT)
Tax Rate: 23%
Reduced Tax Rate: A 13% rate applies to basic foodstuff and animal feed. The excise duty on alcoholic beverages is 12%.
A 9% rate applies to passenger transport, books, medicines, accommodation services and entry fees to cultural events.
Other Consumption Taxes: Exceptions include the sale or rental of immovable property, financial and insurance services, healthcare and education.

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Corporate Taxes

Company Tax: 24.5%
Tax Rate For Foreign Companies: Finnish companies are taxed on their worldwide income; non-resident companies are taxed only on income sourced in Finland.
Capital Gains Taxation: In 2010, the tax rate on capital gains is 28%.
Main Allowable Deductions and Tax Credit: Deductions normally include expenses that are incurred to generate or retain the company’s income such as payments of interest and royalties, realized foreign-exchange losses, 50% of entertainment costs, irrevocable orders to buy goods, doubtful sales receivables, fees for establishing an organization and reorganization costs, R&D expenses, etc.
Other Corporate Taxes: None

Country Comparison For Corporate Taxation

	Finland	OECD	United States	Germany
Number of Payments of Taxes per Year	8.0	14.2	11.0	16.0
Time Taken For Administrative Formalities (Hours)	243.0	199.3	187.0	215.0
Total Share of Taxes (% of Profit)	44.6	43.0	46.8	48.2

Source: Doing Business - Last Available Data.

Individual Taxes

Tax Rate

State income tax	Progressive rates from 6.5% to 29.75% (for income exceeding EUR 70,300).
Municipal tax	from 16.25% to 21.75%
Church tax	from 1% to 2% (depending on regions)

Allowable Deductions and Tax Credit: The following deductions are allowable:
- expenses incurred in excess of EUR500 for traveling to and from work;
- statutory pension insurance and unemployment insurance premiums;
- interest on a loan if the loan was used to buy a permanent home or property that is used to acquire income;
- capital losses;
- medical expenses and alimony are not deductible, but there is a deductible maintenance allowance of EUR80 per child from earned income for each child living with a former spouse.
Special Expatriate Tax Regime: at a flat rate of 35% if that person’s regular monthly cash salary exceeds EUR5,800 (except for teachers and researchers) for 48 months. The application has to be filed within 90 days from the start of the work in Finland.

Double Taxation Treaties

Countries With Whom a Double Taxation Treaty Have Been Signed: See the list of Finland's tax treaties
Withholding Taxes: Dividends: 28%, Interest: 0%, Royalties: 28%

Sources of Fiscal Information

Tax Authorities: National Board of Taxes
Other Domestic Resources: Employment Office guide on taxation of foreigners
Taxation Guide from the Ministry of Finance

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Intellectual Property

National Organizations: Ministry of Education and Culture
National Board of Patents and Registration of Finland (NBPR)
Regional Organizations: European Patent Office
International Membership: Member of the WIPO (World Intellectual Property Organization)
Signatory to the Paris Convention For the Protection of Intellectual Property
Membership to the TRIPS agreement - Trade-Related Aspects of Intellectual Property Rights (TRIPS)

National Regulation and International Agreements

Type of property and law	Validity	International Agreements Signed
Patent Patents act	20 years	Patent Cooperation Treaty (PCT)
Trademark Trademarks act	10 years	Trademark Law Treaty Protocol Relating to the Madrid Agreement Concerning the International Registration of Marks
Design Registered designs act	5 years, renewable
Copyright Copyright act		Berne convention For the Protection of Literary and Artistic Works Convention for the Protection of Producers of Phonograms Against Unauthorized Duplication of Their Phonograms Rome ConventionFor the Protection of Performers, Producers of Phonograms and Broadcasting Organizations WIPO Copyright Treaty WIPO Performances and Phonograms Treaty
Industrial Models Act on utility model rights	4 years, renewable (maximum 10 years total)

Legal Framework

Independence of Justice: Yes
Equal Treatment of Nationals and Foreigners: Yes
The Language of Justice: Finnish and Swedish
Recourse to an Interpreter: In connection with certain matters involving the fundamental rights of an individual, such as taking a child into custody, the party concerned is, according to the Language Act, always entitled to use his or her own language regardless of the language of the municipality. If necessary, interpreters can be used.
Sources of the Law and Legal Similarities: Finland has a parliamentary system. The main source of the law is the constitution of March 2000. The legal system is based on civil law system which originates from the Swedish law. European Community law is directly applicable and takes precedence over national legislation. The country accepts compulsory ICJ jurisdiction, but with reservations.
Checking National Laws Online: Constitution of Finland
Legislation in Finland

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Standards

National Standards Organizations: Finnish Standards Association (SFS)
Integration in the International Standards Network: The Finnish Standards Association SFS and its standards-writing bodies, the Finnish Electrotechnical Standards Association and Finnish Communications Regulatory Authority are members of the European standards organizations CEN, CENELEC and ETSI. SFS is also a member of the International Organization ISO and IEC.
Classification of Standards: SFS (or SFS-EN) + 4 or more digits showing the technical area and the rank in the division.
Online Consultation of Standards: National SFS Standards are sold in Finland only by SFS. Distribution of SFS standards abroad is handled by national ISO member bodies. SFS standards can be viewed in the Catalogue of SFS Standards or downloaded from the online shop of SFS.
Certification Organizations: Finnish Standards Association (SFS)

Business Practices

General Information: A guide to Finnish customs and manners by Virtual Finland
Finnish business culture as seen by the Kwintessential website
Finnish business culture as seen by the Executiveplanet website
Opening Hours and Days: Offices are closed on Saturday and Sunday.

Public Holidays

New Year’s Day	January 1
Epiphany	January 6
Good Friday	End of March or April, changes according to the year
Easter	Sunday and Monday following the Good Friday
May Day	May 1
Ascension Day	May, changes according to the year
Whitsun	May, changes according to the year
Mid-Summer Day	End of June, changes according to the year
All Saints’ Day	End of October or beginning of November, changes according to the year
Independence Day	December 6
Christmas Eve and Day	December 24-25
Boxing Day	December 26

Periods When Companies Usually Close

Christmas	One week between Christmas and New Year
Summer holidays	1-4 weeks starting from Midsummer (around June 24)

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Finland: Business Environment