Finland

There have been changes made to the deadlines in personal taxation for the year 2025. Previously, new tax withholding cards for the tax year came into force in February. Starting in 2025, the new tax withholding cards will be in effect from the beginning of January.

The income tax return filing deadlines for wage earners have been rescheduled. As of 2025, individuals will receive their pre-completed tax return in March, and the deadline for the return will be in April as opposed to previous years when it was in May.

Changes have been made to the ex officio deductions on earned income. The earned income deduction has been disbanded, and the effects will be compensated with adjustments to the work income deduction.

The household deduction will also change for tax year 2025, with adjustments to the maximum amount and credit threshold.

Highlights from 2026 tax legislation change proposals

Expatriate tax decrease and application to returning Finnish citizens

It is proposed that the tax at source for foreign key employees be reduced to 25% from 32%. The law would also be applied to Finnish citizens returning to Finland for up to 24 months.

Tax reductions for earned income and pension income 

The government proposal suggests that the highest marginal tax rates on earned income would be reduced to around 52%. In addition, according to the proposal, the additional tax rate assessed on pension income will be reduced from the current 5.85% to 4%. It is proposed that the income threshold beyond which the additional pension income tax must be paid will be increased from the current 47,000 to 57,000 euros (EUR).

Tax year for additional purchase price (earn out)

Under the proposed amendment to the Income Tax Act, capital gains from a conditional additional purchase price/earn out will be taxed in the year when the obligation to pay and the amount are determined. This provides clarity on which year's income the additional purchase price will be taxed for the taxpayer. The proposal also includes provisions for adjusting capital losses and specifies that capital gains are realised in the year the transfer agreement is executed.

Inheritance and gift taxation 

The government proposal suggests that the minimum taxable amount in inheritance taxation be increased from EUR 20,000 to EUR 30,000. The government proposal suggests that the minimum taxable amount in gift taxation be increased from EUR 5,000 to EUR 7,500.

Tax audits

The Finnish Tax Administration's data collection capabilities are set to be enhanced. The Ministry of Finance has released a draft proposal for consultation that aims to strengthen the Tax Administration's right to process large data sets via third-party audits, focusing on combating the shadow economy. These audits would be guided by risk assessments without targeting specific individuals or entities. The consultation period ends on 18 August 2025, with changes expected to take effect on 1 January 2026.

Use of Tax Administration’s MyTax service to be increased

The draft government proposal suggests that tax decisions and other official documents could be delivered through the Tax Administration's electronic service, MyTax, whenever the taxpayer has utilised this service.