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VAT in Finland

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VAT legislation has been harmonized in many respects across the EU, including in Finland. The EU directive is binding for each member state, but the choice of implementation is left to each EU country which needs to adjust it according to its national law.

In the past, Finland used to apply a system called turnover tax (sales tax) prior to the introduction of the present VAT system which was introduced in 1994 as a result of Finland’s EU membership.

Everything you need to know about VAT registration, returns, Tax Representation (if applicable), and your legal duties in Finland is conveniently located right here!

VAT guide Finland

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Scope of Taxation

The Value Added Tax Act, Act No. 1501/1993(Arvonlisäverolaki) is the main piece of Finnish legislation. Other Finnish laws are also relevant to VAT implementation. Penalties, for example, are covered by the Act on Assessment Procedures for Self-Assessed Taxes (768/2016).

 

VAT is generally levied on all supplies of goods or services:  

  • Supplied in Finland
  • By taxable individuals
  • During the course of their business

VAT is charged on the following types of transactions:  

  • A taxable person’s provision of goods or services in Finland
  • A taxable person’s intra-Community procurement of goods from another EU Member State
  • The importation of items from outside the EU, regardless of the importer’s status

Any sale or other provision of products or services, including barter exchanges and specific business presents, whether invoiced or not, are referred to as a “supply.”

 

Taxable transactions also include any action that removes goods or services from a business, whether or not they are charged for, such as loans, gifts, or “self-supply,” which refers to the private use of business assets.

 

Among the self-supplies are: 

  • Selling items to employees, such as canteen meals or vending machines
  • Sales of business assets
  • Hiring or lending goods to another person
  • Commissions charged for selling on someone else’s behalf
  • Goods that have been taken out of the business by employees for personal use, either temporarily or permanently
  • Services provided to the company but then used privately

 

Taxable persons include: 

  • Independent entities that carry out economic activity
  • Non-commercial entities such as public bodies who carry out an economic activity of commercial value

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Finland –  General VAT information

 

National Legislation  Verohallinto 
VAT in local languages   Arvonlisäverolaki (ALV) 
VAT number format   FI+8 digits 
FI12345678 
VAT rates  Standard 24%; Reduced 14% & 10% 
Zero-rated (0%) and exempt 
Frequency  Monthly (or in some instances quarterly or annually) 
Thresholds 

 

Registration   
Established  EUR 15,000 
Non-established  None 
Intra-Community acquisitions  EUR 10,000 
Intra-EU Distance sales and electronically supplied services to consumers (OSS)  EUR 10,000 
Recovery of VAT by non-established businesses  Yes 
Compliance Returns and Deadlines 
VAT Return  12th day of the second month following the end of the accounting period 
European Sales Listing  20th day following the end of the filing period 
Intrastat M  11th day following the end of the filing period 
Annual Return  Annual returns are not required in Finland. 


 

Last Updated: 08/08/2022

Disclaimer

The information provided by Global VAT Compliance B.V. on this webpage is intended for general informational purposes only. Global VAT Compliance B.V. is not responsible for the accuracy of the information on these pages, and cannot be held liable for claims or losses deriving from the use of this information. If you wish to receive VAT related information please contact our experts at support@gvc.tax

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