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: