Finland

Finnish resident companies are subject to Finnish corporate income tax (CIT) on their worldwide income (i.e. unlimited tax liability). Also, Finnish permanent establishments (PEs) of non-resident companies are subject to Finnish CIT on their worldwide income attributable to the PE.

The CIT rate is 20%.

Pillar Two Implementation

The government proposal for the Finnish Pillar Two legislation was approved by the Finnish Parliament on 11 December 2023. The proposal implements the Income Inclusion rule (IIR), the Undertaxed Profits Rule (UTPR), and the Qualified Domestic Minimum Top-up Tax (QDMTT). The IIR and QDMTT are applied for financial years starting on or after 31 December 2023, and the UTPR is applied for financial years starting on or after 31 December 2024.  

The government proposal closely follows the European Union (EU) Directive and the Global Anti-Base Erosion (GloBE) Model Rules. Further, the central role of the Organisation for Economic Co-operation and Development's (OECD’s) (existing and future) guidance is clearly acknowledged in the proposal as a key to ensure harmonious implementation globally and to avoid differing interpretations across jurisdictions. However, some relevant aspects of the OECD’s recent guidance are not yet included in the government proposal, and further updates to the law are expected.

The Finnish constitution requires that a tax law should include a sufficient level of detail to allow taxpayers to calculate their tax liability and leave little room for interpretation. These constitutional restrictions may cause uncertainties with respect to application of specific rules based on the OECD guidance where those deviate from the Finnish Pillar Two legislation. 

For more detailed information and most recent updates, please visit PwC’s Pillar Two Country Tracker.

Public service broadcasting tax

Public service broadcasting tax (Yleisradio or YLE tax) for companies and organisations is based on the taxable income for a fiscal year. The tax amounts to 140 euros (EUR) per year if the taxable income of the organisation is at least EUR 50,000. For organisations with taxable income exceeding EUR 50,000, the tax is levied at EUR 140 plus 0.35% of the taxable income exceeding EUR 50,000. The maximum of the annual tax is EUR 3,000, which will be payable by organisations with taxable income of EUR 867,142 or more.

YLE tax is deductible in the taxation of income of a company.

Local income taxes

No municipal or local income taxes are levied in Finland on the income of a company.