Executive Summary
Finland’s tax agenda for late 2026 is dominated by structural reforms affecting corporate income tax, global minimum tax, digital asset reporting, and VAT modernization. The Government proposes cutting the CIT rate to 18% and extending loss carryforwards to 25 years, while Pillar Two compliance obligations for large MNEs and expanded DAC8 crypto reporting take effect alongside phased ViDA e-invoicing requirements.
Important Updates
Corporate Income Tax Rate Reduction to 18% and Extended Loss Carryforward
The Finnish Government has submitted legislative proposal HE 2026 to Parliament, seeking to reduce the statutory corporate income tax rate from 20% to 18% and extend the maximum business loss carryforward period from 10 years to 25 years. Originating from the Ministry of Finance as part of the broader competitiveness agenda, the changes would apply to tax years beginning on or after 1 January 2027, subject to Parliamentary approval and Presidential assent. The proposal preserves the existing restriction that losses may only be deducted against future profits from the same trade and does not introduce loss carryback. The 25-year window applies retrospectively to losses not yet time-barred under the current 10-year rule, effectively reviving losses that would otherwise have expired between years 11 and 25.
Multinational groups must remeasure deferred tax assets and liabilities under IAS 12 at the new 18% rate upon substantive enactment, potentially triggering a one-time P&L charge or credit depending on net deferred tax positions. Capital-intensive sectors such as forestry, energy, and manufacturing, as well as start-ups with extended ramp-up periods, stand to benefit from an enhanced tax shield on accumulated losses. Foreign investors should reassess Finnish holding-company structures and intra-group financing arrangements in light of the lower rate. Companies should update tax provision models, transfer pricing documentation, and advance ruling requests while monitoring the autumn 2026 parliamentary timetable. Non-compliance risks include standard late-filing penalties (minimum EUR 100, maximum 20% of unpaid tax) and interest on underpaid preliminary tax instalments.
Sources: Verohallinto – Government Proposal on CIT Cut and Loss Carryforward
OECD Pillar Two Global Minimum Tax Enforcement for Large MNE Groups
Finland has implemented the OECD/G20 Inclusive Framework’s Pillar Two rules via the Act on Global Minimum Tax (Laki globaalista minimiverosta 2023/1422), transposing EU Directive 2022/2523. The regime applies to fiscal years starting on or after 31 December 2023, with the first top-up tax liabilities arising for FY 2024. The legislation introduces three interlocking rules: the Qualified Domestic Minimum Top-up Tax (QDMTT), the Income Inclusion Rule (IIR), and the Undertaxed Profits Rule (UTPR). The effective tax rate is calculated per jurisdiction using GloBE rules, with a 15% minimum rate. Safe harbours, including the transitional CbCR safe harbour and routine profits test, apply for FY 2024–2026.
The rules capture MNE groups with consolidated annual revenue of at least EUR 750 million in two of the four preceding fiscal years, affecting roughly 120 Finnish-headed groups and numerous foreign-headed groups with Finnish subsidiaries. Key sectors include forestry, machinery, maritime, telecom, and gaming. Compliance requires filing the GloBE information return (Form 79A) within 15 months of fiscal year-end (18 months for FY 2024), with the FY 2024 return due by 30 September 2026. Penalties include late filing fees of EUR 500 per day (capped at EUR 100,000) and up to 20% of underpaid top-up tax for inaccurate returns. Groups should engage in early dry-run calculations to identify data gaps and may use the Tax Administration’s Pillar Two helpdesk (pilar2@vero.fi).
Sources: Verohallinto – OECD Pillar Two Global Minimum Tax
Dividend Taxation Reform and Share-Exchange Valuation Rules
The Finnish Parliament has passed the Government Bill amending the Income Tax Act and the Act on the Taxation of Business Income, effective 1 January 2027. For individuals, the earned-income portion of dividends from listed companies is reduced from 25% to 20% of the gross dividend, while the capital-income portion (taxed at 30%/34%) correspondingly increases. For unlisted companies, the net-asset-value-based safe harbour is replaced by a mathematical formula linking the capital-income share to the company’s equity ratio, aiming to curb tax-driven dividend smoothing. In qualifying share-for-share exchanges, the receiving company may elect to value acquired shares at the contributor’s tax book value (carryover basis) instead of fair market value, deferring latent capital gains until a subsequent taxable disposal. The election is irrevocable and requires formal notification in the tax return for the year of exchange.
Individual shareholders in listed firms benefit from a lower effective marginal tax rate on dividends (maximum approximately 31% versus the previous 33%), while owners of unlisted SMEs face more complex calculations and potential acceleration of capital-income taxation. Corporate groups restructuring via share-for-share exchanges gain a deferral tool aligned with the EU Merger Directive. The new dividend split applies to dividends decided on or after 1 January 2027, and listed companies must update investor communications and withholding systems by that date. Failure to make the carryover-basis election defaults to fair-value recognition, triggering immediate capital gains tax (20% for corporates, 30%/34% for individuals), with late elections not permitted. The Tax Administration will issue detailed instruction (Ohje 2027/YY) by December 2026.
Sources: Verohallinto – Dividend Taxation and Share-Exchange Valuation Reform
Expanded Crypto-Asset Reporting Obligations from Tax Year 2026
In line with the EU’s Eighth Directive on Administrative Cooperation (DAC8) and the OECD Crypto-Asset Reporting Framework (CARF), the Finnish Tax Administration will receive significantly broader data on crypto-asset transactions starting with the 2026 tax year. The legal basis is the Act on Reporting Obligations for Crypto-Asset Service Providers (CASPs), transposing DAC8 into Finnish law. Crypto-asset service providers—including exchanges, wallet providers, and custodial services—must collect and report detailed customer and transaction data, including full name, address, tax residence(s), TIN, date and place of birth, and for each transaction: type, date, quantity, market value in EUR, and wallet addresses. Reporting covers both Finnish-resident and non-resident customers served by Finnish CASPs, and Finnish residents served by foreign CASPs via the automatic exchange of information network.
Approximately 40 licensed Finnish CASPs and foreign CASPs serving Finnish clients are directly affected, with the first report due 31 January 2027 for 2026 transactions. CASPs must register with the Financial Supervisory Authority (FIN-FSA) by 31 December 2026 and implement compliant data-capture systems, with late or inaccurate reporting incurring administrative fines up to EUR 200,000 per breach. Taxpayers must declare crypto gains in the 2026 pre-completed tax return (available March 2027); discrepancies trigger automated audit letters, and penalties for undeclared gains range from 20% to 40% of omitted tax plus 7% interest. The Tax Administration will issue detailed guidance (Ohje 2026/XX) by Q4 2026.
Sources: Verohallinto – Crypto-Asset Reporting Obligations
Extended Interest Deduction Rights for Critical Infrastructure Projects
Government Proposal HE 132/2026 vp, submitted on 14 October 2026, proposes amendments to the Business Income Tax Act (Sections 14b and 18a) to create a targeted exception to the OECD BEPS Action 4 / EU ATAD II earnings-stripping rule (30% EBITDA cap) for financing structures linked to “Projects of Critical Infrastructure.” The proposal, effective 1 January 2027 for interest expenses accruing in fiscal years starting on or after that date, replaces the 30% EBITDA cap with a project-specific “Arm’s Length Debt Capacity” test for qualifying projects. Deductible interest is capped at the level an independent lender would provide to the project SPV based on projected cash flows, DSCR benchmarks, and sector risk premiums. Qualifying sectors include energy, transport, digital, and water/waste infrastructure.
Qualification requires a Government “Critical Infrastructure” designation from the Ministry of Economic Affairs, project financing ring-fenced in an SPV with non-recourse debt, a minimum equity ratio of 20%, and an Advance Pricing Agreement (APA) on the debt capacity benchmark. Taxpayers must apply for project designation by 30 November 2026 for 2027 projects and simultaneously file an APA request with the Tax Administration’s Advance Pricing Unit. Annual compliance requires filing a “Project Finance Interest Deduction Report” (Form 60B) with the CIT return. Non-compliance triggers immediate reversion to the standard 30% EBITDA cap with 20% penalty interest on the excess deduction. The carve-out does not apply to general corporate borrowing by operating companies.
Sources: Verohallinto – Interest Deduction Rights for Critical Infrastructure
Buyer Liability for Excise Duties on Alcohol Ordered Online from Abroad
On 26 October 2026, the Finnish Tax Administration clarified excise duty liability for consumers ordering alcoholic beverages via distance selling from other EU Member States or third countries. Based on the amended Alcohol Act (1143/2017) and EU Directive 2008/118/EC as transposed into the Excise Duty Act (182/2010), the Finnish buyer becomes the taxable person at the moment the goods enter Finland. For EU purchases, the foreign vendor must be registered in EMCS and charge Finnish excise duty rates at point of sale under the destination principle. If the vendor fails to do so, the Finnish buyer must declare and pay the duty via the “Ilmoita verot” e-service within 10 days of receipt. The 2026 rates include ethyl alcohol at EUR 4.21/liter, wine at EUR 0.58–3.12/liter depending on ABV, and beer at EUR 0.08–0.42/liter/°Plato, with VAT at 25.5% due on customs value plus excise duty.
Logistics providers face joint and several liability under Section 42 of the Excise Duty Act for transporting excise goods without an electronic Administrative Accompanying Document (e-AD). Consumers receiving untaxed shipments must file Form “Valmisteveron ilmoitus yksityishenkilölle” within 10 calendar days of physical receipt, with payment due by the 12th day of the following month. Failure to declare incurs a 15% negligence penalty (minimum EUR 50) plus 7% late-payment interest. A joint Tax Administration and Customs “E-commerce Alcohol” audit campaign targets 500 high-volume importers in Q4 2026/Q1 2027.
Sources: Verohallinto – Excise Duties on Online Alcohol Purchases
Proposed Tax Refund for Professional Diesel in Heavy Goods Transport
The Finnish Government submitted legislative proposal HE 145/2026 vp on 28 October 2026, amending the Act on Excise Duty on Liquid Fuels and the Act on Vehicle Tax to introduce a refund mechanism for the energy content portion of excise duty on diesel used in commercial freight transport. Effective 1 January 2027 pending Parliamentary approval by December 2026, the refund applies to vehicles exceeding 7.5 tonnes maximum authorized mass used exclusively for commercial goods transport. The proposed refund rate is EUR 0.12 per liter, reducing the duty burden by approximately 22% for eligible operators, while the strategic component and carbon tax component remain non-refundable.
Eligibility requires a valid Community Licence or bilateral permit, installation of an approved telematics device recording distance driven in Finland, and quarterly refund applications via MyTax with supporting mileage data. Carriers must register by 15 December 2026 for the first Q1 2027 refund (application window 1–30 April 2027). Misuse triggers a five-year ban and a penalty equal to 300% of the erroneously claimed amount. The measure targets roughly 8,500 Finnish haulage firms and 3,000 foreign carriers, with estimated annual sector savings of EUR 45–50 million. Buses, construction machinery, and agricultural vehicles are excluded.
Sources: Verohallinto – Diesel Tax Refund Proposal
CRS and DAC2 Reporting Guidance for Financial Institutions
On 27 October 2026, the Finnish Tax Administration published comprehensive guidance on reporting obligations under the Common Reporting Standard (CRS) and the EU Directive on Administrative Cooperation (DAC2). The legal basis includes the Act on the Automatic Exchange of Financial Account Information and EU Directive 2014/107/EU. The guidance is effective for the reporting period covering calendar year 2025, with reports due by 30 June 2026. It details due diligence procedures for new and pre-existing accounts, clarifies the definition of “reporting financial institution,” and provides updated instructions on XML schema reporting, undocumented accounts, and controlling persons for passive non-financial entities.
The guidance incorporates the 2025 OECD CRS amendments regarding mandatory disclosure of certain digital platform operators and reporting of crypto-asset transactions. All Finnish banks, investment firms, insurance companies, asset managers, and other reporting financial institutions must comply, as must non-Finnish institutions with a Finnish branch. Records of due diligence procedures must be maintained for at least six years. Failure to report, late reporting, or inaccurate reporting may result in administrative fines, and the Tax Administration will conduct compliance reviews with penalties for systemic failures.
Sources: Verohallinto – CRS/DAC2 Reporting Guidance
EU ViDA Package to Overhaul Finnish VAT Compliance
The EU’s VAT in the Digital Age (ViDA) legislative package, comprising a Directive amending Directive 2006/112/EC and a Regulation on administrative cooperation, was politically agreed in early 2026 and is expected to enter into force by mid-2026. Finland will transpose the Directive via amendments to the Value Added Tax Act. The measures aim to close the EUR 93 billion EU VAT gap through four pillars with staggered deadlines: real-time digital reporting (e-invoicing) for B2B transactions mandatory from 1 July 2030 for large taxpayers (turnover > EUR 100M) and 1 January 2032 for all others; platform economy deemed-supplier rules from 1 January 2028; Single VAT Registration (OSS expansion) from 1 January 2029; and VAT registration threshold harmonisation (EUR 85,000) from 2035.
All VAT-registered businesses in Finland (approximately 300,000 entities) are affected. E-commerce platforms face immediate system changes, and ERP vendors must embed Peppol access points. The Tax Administration estimates one-time compliance costs of EUR 2,000–15,000 per SME, with ongoing savings from automated VAT returns. Implementation regulations (Asetus ViDA-toimeenpanosta) are expected by Q1 2027, with an e-invoicing pilot sandbox planned for 2028. Transitional penalties are 0% for the first 12 months of each obligation, then standard VAT penalties of 5–15% of omitted tax.
Sources: Verohallinto – EU ViDA Package Overview
Secondary Regulatory & Regional Updates
- Tax-Free Travel Expense Reimbursements for 2027: The Tax Administration set maximum tax-free per diem and kilometre allowances for 2027: full day (absence >12h) EUR 51.00, half day EUR 25.50, short trip EUR 14.00; kilometre allowance EUR 0.49/km for the first 15,000 km/year and EUR 0.21/km thereafter, with a EUR 0.04/km EV supplement. Rates apply to travel commencing on or after 1 January 2027; employers must update payroll systems and documentation. Source 1 | Source 2
- Death Estate Tax Management Moves to MyTax in 2027: Estate tax administration, including income tax returns (Form 5A) and inheritance tax declarations, will be fully integrated into the MyTax online service starting in early 2027 using strong electronic identification. Shareholders and authorized agents must be registered in the Valtuutusrekisteri; a test environment will be available in Q4 2026. Source
- Tax Barometer Survey Shows Record Support for Taxation: The 2026 Tax Barometer shows 96% of Finns agree taxes are necessary to maintain the welfare state, with record-low tolerance for tax evasion. The Tax Administration will shift resources toward targeted risk-based audits and reiterated the voluntary disclosure program deadline for offshore assets ending 31 December 2026. Source
- Supervision Programme 2027 Focuses on Alcohol and Labor-Intensive Sectors: The Tax Administration’s 2027 supervision programme designates alcohol production/distribution and labor-intensive services as Priority 1 for intensified audit, deploying 40 new specialized auditors and using data analytics. Construction main contractors must verify subcontractor tax compliance via API before first payment, with a EUR 2,000 penalty per violation. Source
- Household Deduction Increased Retroactively for 2026: The maximum annual household deduction rises from EUR 2,250 to EUR 3,500 per taxpayer (70% of expenses) for the 2026 tax year, retroactive to 1 January 2026, with new eligible services including digital home services and energy efficiency advisory visits. Taxpayers claim the deduction in the 2026 pre-completed tax return or via MyTax correction by 2 May 2027. Source
- Finnish Tax Administration Switches Bank Account Provider: Effective 1 December 2026, the Tax Administration opens a new OP Financial Group account while the existing Danske Bank account remains operational until 31 May 2027. Taxpayers must ensure payment messages contain the correct virtual reference number and update banking master data to avoid misdirected payments and late-payment interest. Source
- Guidance on Assignments and Losses of Capital Loans: The Tax Administration issued guidance on 29 October 2026 clarifying that assigning a capital loan at fair market value does not trigger a taxable event, while assignments below nominal value may create a deductible loss. Capital loans are subject to specific loss deductibility restrictions under Chapter 5a of the Income Tax Act, and losses must be claimed in the year the loan becomes definitively irrecoverable. Source
- Reverse VAT Liability on Sale of Metal Scrap and Waste: Updated guidance effective 27 October 2026 applies the reverse charge to supplies of metal scrap and waste between Finnish-established taxable persons. The customer accounts for VAT instead of the supplier, who must issue an invoice without VAT referencing the reverse charge provision. The rule does not apply to consumer sales or exports. Source
Disclaimer: This article is compiled and summarized by the AI based on publicly available information and is for general information purposes only. It does not constitute any form of formal tax advice, legal opinion, or basis for performance. Please consult a qualified professional tax advisor or legal counsel for tax advice.