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New Finnish Tax Account system

10 Mar 2010

Those who pay self-initiated, un-prompted taxes in Finland will benefit from the new tax account system in 2010. The new Finnish tax account system amends the previous system of monthly returns, payments and refunds. Taxand Finland discusses the benefits for taxpayers.

The tax types covered by the new tax account system include inter alia the value added tax, the withholding tax from wages and the employers' social security contributions, the withholding tax/tax at source on dividends and interest payments, the insurance premium tax and the lottery tax. Tax types not covered by tax account are income tax, real estate tax, inheritance tax, forestry fees and transfer tax.

Under the new regime, as of 1 January 2010, the tax authorities establish taxpayer specific accounts containing aggregate tax return and payment information, as well as all other necessary details. Taxpayers who submit periodic tax return filings and make payments of the relevant tax account taxes will become a tax account holder and user. The specified taxes are reported on a single monthly tax return (periodic tax return) and the payment date and process for the taxes have all been unified. Furthermore, in the new tax account system, all the taxes can be paid in a single payment to the tax account of the taxpayer. The new system also allows the taxpayer to recover negative VAT faster and more easily than before. Furthermore, late payments will also be handled on a uniform basis. The tax account can be used and followed through Tax Account Online (a dedicated web service).

Looking to the future, the tax account regime plans will be extended to cover all taxes levied by the tax authorities in Finland.

Taxand's Take

The new tax account system amends monthly returns and payments, and refunds systems concerning most self-initiated taxes. The tax account enables the taxpayers to subtract VAT from other taxes payable. The tax account gives the taxpayer a better overview of the current situation and payments on taxes. Instead of having several tax due dates, there is only one due date per month for payments and one tax return for the tax types included in the system. Taxpayers stand to benefit from the implementation of the new Finnish tax account system reducing the time spent on paying taxes.

Your Taxand contact for further queries is:
Janne Juusela
T. +358 9 615 333

Taxand's Take Author