Finland country profile | KPMG | GLOBAL
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Finland country profile

Finland country profile

Key tax factors for efficient cross-border business and investment involving Finland.


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EU Member State


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Forms of doing business

Limited liability company (Oy),
limited partnership (Ky).

Legal entity capital requirements

Minimum share capital of Oy - EUR 2,500.

Residence and tax system

A company is resident in Finland if it is incorporated under Finnish law.
Residents are subject to tax on their worldwide income. Non-residents are subject to Finnish tax on their Finnish source income.

Compliance requirements for CIT purposes

Fiscal year follows the financial period. Tax return should be filed within four months after the end of a fiscal year, e.g. if financial year ends on December 31, 2016, the corporate income tax return needs to be filed no later than April 30, 2017.

Tax rate

20 percent

Withholding tax rates

On dividends paid to non-resident companies

0 / 15 / 20 / 30 / DTT percent.

On interest paid to non-resident companies

0 percent.

On patent royalties and certain copyright royalties paid to non-resident companies

0 / 20 / 30 / DTT percent.

On fees for technical services


On other payments


Branch withholding taxes


Holding rules

Dividend received from resident/non-resident subsidiaries

Dividends received by a Finnish corporate entity are tax-exempt in Finland if the dividend-distributing entity qualifies under the Parent-Subsidiary Directive or is resident in an EEA state and subject to tax on the profits from which the dividend is distributed at a rate of at least 10 percent.

However, dividend is fully taxable if the dividend distributing entity is a listed company and the dividend recipient is not a listed company and does not hold at least 10 percent of the shares in the dividend distributing entity.

75 percent of dividends derived from investment assets held by a financial, insurance or pension institution are taxable when the dividend distributing company is an entity covered by the Parent-Subsidiary Directive but where the 10 percent minimum holding requirement is not met or the dividend distributing entity is a domestic company or a company from an EEA state which does not fall under the Parent-Subsidiary Directive.

Dividend is fully taxable if it is deductible to the payer or if the dividend relates to a tax avoidance arrangement.

Dividends received by Finnish corporate entities from other than EU and EEA states are fully taxable if not exempted in the applicable tax treaty.


Capital gains obtained from resident/non-resident subsidiaries

Exempt, if participation exemption requirements are met. Otherwise taxable.

Tax losses

Tax losses can be carried forward for 10 tax years. Carry-back is not allowed. Tax loss carry-forwards are forfeited if more than 50 percent of the company’s shares are subject to direct or indirect change of ownership.

Tax consolidation rules/Group relief rules

Group consolidation possible via group contributions.

Registration duties

Trade register, applicable tax registers.

Small administrative registration fee.

Transfer duties

On the transfer of shares

Yes 1.6 percent, if the seller or buyer is resident in Finland for taxpurposes and the shares are not publicly traded. 2 percent transfer tax applies on the transfer of shares of a real estate company or a joint-stock property company, on the transfer of shares in group companies holding the group’s property, and on transfer of shares in real estate investment companies.

The transfer of shares in foreign companies can be subject to Finnish transfer duty provided that the preconditions listed below are fulfilled:

  • the company’s business operations consists of the direct or indirect ownership or management of real estate (real estate company);
  • over 50 percent of the company’s total assets directly or indirectly consist of real estate located in Finland;
  • at least one of the parties participating in the transaction is generally tax liable to Finland (a person, corporation or certain branches that are resident in Finland for tax purposes).

On the transfer of land and buildings

Transfer tax of 4 percent, based on the purchase price of the property.

Stamp duties


Real estate taxes

Real estate taxes are levied. Rates vary by municipality.

Controlled Foreign Company rules

Yes. Generally, if Finnish entities or individuals hold at least a 50 percent stake in a Controlled Foreign Company (“CFC”), or its foreign branch, which is subject to a low level of taxation and does not carry on business activities in certain lines of business, the Finnish CFC rules must be applied. CFC rules are not applied to companies effectively established in EEA Member States or treaty countries not on the black list.

Transfer pricing rules

General transfer pricing rules

Yes. Generally, the provisions of the OECD Transfer Pricing Guidelines are followed when determining the arm’s length prices.


Documentation requirement


Thin capitalization rules

No, but earnings stripping rules in place.

General AntiAvoidance rules (GAAR)


Specific AntiAvoidance rules/Anti Treaty Shopping Provisions


Advance Ruling system


IP / R&D incentives


Other incentives

Accelerated depreciation for qualifying new industrial investments acquired and taken into use between 2013 and 2016.


The standard rate is 24 percent, and the reduced rates are 14 and 10 percent.

Other relevant points of attention


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Jussi Jarvinen

KPMG in Finland

T: +358 20 760 3077


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