Nonresidents are taxed on their Finnish-sourced income, divided into two categories: income from capital and earned income. These categories are taxed separately at different rates. Nonresident individuals earning income from capital are taxed at progressive rates, from 30% to 34%. Nonresidents earning earned or employment income are taxed at a flat rate of 35%.

Income from capital includes yields from capital investments, dividends, interest, capital gains and rental income.

Tax on capital income is levied at progressive rates.

Income Tax on Capital Income

Capital (investment) income is taxed at rates of 30% and 34% (the latter percentage is applicable when the annual taxable capital income exceeds EUR 30,000).

Rental Income Tax

Rental income falls under the income from capital category and is taxed at progressive rates, from 30% to 34%. Income-generating expenses, such as maintenance, renovation, and interest (if the loan was used to acquire income), are deductible from rental income before the tax is imposed.

Corporate Taxation

Income Tax

Corporate income and capital gains are taxed at a flat rate of 20%. Income-generating expenses and other business-related expenses are deductible from gross income.

Capital Gains Tax

Gains from the sale of property are included in the income from capital category and taxed at progressive rates, from 30% to 34%. Gains not exceeding €1,000 are exempt from capital gains tax. Taxable capital gains are computed in two ways:

1. Gross selling price less acquisition costs
2. Gross selling price less 20% in lieu of actual acquisition costs

Buying and Selling Costs/Taxes

Property Holding Tax

Real Property Tax (kiinteistövero; fastighetsskatt)

A real estate tax is levied on properties located in Finland. The actual rates are established by the municipalities, which receive the revenue from this tax. The tax is imposed on the value of the property, with rates varying between municipalities, ranging from 0.41% to 2%.