Finland

Finnish corporations paying certain types of income are required to apply a 20%, 15%, or 35% WHT on payments to foreign corporations and a 30% or 35% WHT on payments to non-resident individuals or other than corporate entities.

According to domestic legislation, interest paid to a non-resident is usually tax exempt in Finland.

No WHT is levied on dividend payments received by companies resident in the EU/EEA, which would have been tax-free if paid to a Finnish corporate body, if the WHT cannot be fully credited in the company’s country of residence.

Dividends paid to a company referred to in the EC Parent-Subsidiary Directive, owning at least 10% of the capital of the dividend distributing company, are also tax exempt.

The domestic WHT rate may be 15% (or lower under a relevant tax treaty) in cases where the shares of the distributing company belong to the investment assets of the non-resident beneficiary of dividends and if certain prerequisites are met.

See the table below for WHT rates on dividends and other payments from Finland to non-residents.

For countries not included in the table, the WHT rate is 20% (corporate entity) and 30% (individual or other than corporate entity).

Note that each tax treaty should be studied carefully because there are often exceptions to general rules.

Notes

* The recipient is a company whose share in the company making the payment is at least the percentage indicated in brackets.

1. Tax is not levied on literary, scientific, or artistic royalties (for film royalties see text of treaty).
2. If corporate entity, then:
   • no tax if these dividends were tax free under Business Tax Act and if the recipient does not receive a full credit for the Finnish tax in the country of residence, and
   • no tax on dividend paid to a company meant in the EU Parent-Subsidiary Directive owning at least 10% of the capital of the paying company.
3. The tax rate is 15% on films, tapes used in television or radio broadcasts, use of copyright of literary, artistic, or scientific works, or royalty paid for usufruct.
4. The tax rate is 10% on literary, scientific, artistic, and film royalties.
5. The tax rate for an individual is 30% if income is tax-exempt in the country of residence.
6. A lower tax in certain cases.
7. Foreign capital greater than 100,000 United States dollars (USD) when dividend becomes due and payable.
8. See the treaty for additional requirements.
9. Tax agreement does not apply if the recipient is a special holding company.
10. The tax rate is 5% on royalties from films and tapes.
11. The tax rate is 15% if the payer is also an industrial enterprise.
12. The 10% is calculated on the total voting stock.
13. The tax rate is 5% for computer software.
14. The tax rate is 5% for the use of secret process or for know-how; no tax for computer software or patent.
15. The tax rate is 10% on industrial royalty, 3% on royalties to news agency, and 5% on artistic royalty to the author or the author's mortis causa successor.
16. The tax rate is 2.5% on royalties paid for the use of computer software.
17. The tax rate is 5% on royalties paid for the right to use of software.
18. The tax rate is 15% if the recipient is a company.
19. There is no tax on dividends to qualified parents-subsidiaries and pension funds.
20. There is no tax if the recipient proves that one has domicile (individual) or is incorporated in the United Arab Emirates.
21. If corporate entity tax is 15% or 20% (§7 subsection 1 paragraph 2 and 3, Act on Tax at source).
22. No tax on royalties between associated companies meant in EU Directive (2003/49/EC, 2013/13/EU).
23. No WHT if the recipient is a pension scheme.
24. SopS 55/2016
25. SopS 67/2019
26. SopS 15/2021
27. No tax on dividends to qualified pension funds (Article 10 paragraph 3).

Note that there is no treaty with Portugal as of 1 January 2019. The old treaty (27/1971) has been terminated, and the new treaty is not in force.

Non-treaty areas include Andorra, Antigua and Barbuda, Bahama Islands, Bahrain, Belize, Cayman Islands, Channel Islands, Gibraltar, Grenada, Greenland, the Spitsbergen, Jan Mayen, Liberia, Macao, Mauritius, Monaco, Panama, Samoa, San Marino, Vanuatu, and Virgin Islands.