Finland Income Tax Rates 2014
In Finland Taxation of an individual's income is progressive.
In other words, the higher the income, the higher the rate of tax payable.
In 2014 the income tax rate (national tax) for an individual is between 6.5%-31.75%.
In addition to direct taxation there is also municipal tax in Finland.
This tax is payable by an individual on his or her income and it fluctuates between 16.25% - 22% depending on the municipal authority.
Church tax of 1%- 2% is also payable.
Foreign residents generally pay 35% on salary income and 30% on dividend, interest and royalties income. Reduced rates of tax or exemption are available for certain income earners.
The standard rate of Finland corporate tax in 2014 is 20%.
In general private companies in Finland are characterized by the suffix OY after their names.
Public companies have the suffix OYJ.
For additional info,please see Finland Tax Office www.vero.fi
Finland Income Tax for an Individual
An individual is liable for tax on his income as an employee and on income as a self-employed person.
Tax will be payable on income earned in Finland and overseas by an individual who meets the test of a "permanent resident" of Finland.
A Finnish resident who receives a salary overseas and lives overseas continuously for at least 6 months, is exempt from tax on certain conditions.
A foreign resident who is employed in Finland pays tax only on income earned in Finland.
To be considered a Finnish resident, the taxpayer must be able to show that his or her life is centered in Finland and / or that they have lived in Finland continuously for 6 months.
It is important to point that that in regard to taxable income from outside Finland, a "tax credit" is allowed for tax deducted outside Finland.
In regard to income from a salary, an employer is obligated to deduct the amount of tax demanded each month.
A self-employed person is obliged to make advance payments of income tax that will be offset on submitting an annual return.
The advance payments are determined according to the return for the previous year. In the event of a new business, the advances will be calculated according to the estimate of the owner of the business.
Certain payments are deductible from taxable income as detailed below.
Finland Individual income tax rates (national tax) 2014: