Tax rate by region Finland

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The information provided on this page is intended for general informative purposes only. It should not be interpreted as tax advice, nor is it meant to be. For advice on your particular tax responsibilities, consult with an experienced tax expert. PayPro Global does not assume any responsibility for any action taken or not taken based on the information presented here.

Essential Guide to SaaS VAT in Finland

Finland’s robust tax administration implements the EU Value Added Tax (VAT) system for businesses, including those offering Software-as-a-Service (SaaS) solutions. Understanding and adhering to Finland’s SaaS sales tax regulations is essential for smooth business operations and compliance. The standard VAT rate for SaaS is 25.5%, consistent with most EU member states. This rate applies to all digital services provided to businesses and consumers within Finland. Companies exceeding the annual threshold of €15,000 must register for VAT, collect the tax from their customers, and submit regular VAT returns to the Finnish Tax Administration. These periodic reports, typically monthly, detail all taxable transactions and must be submitted by 12th day of the second month following the tax period.

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Finland

Finland adopted the EU VAT system in 1994, focusing on maintaining a robust tax administration.

Official government link: Verohallinto

25.5%

E-products and services VAT/Sales tax rate

14.00%

Reduced tax rate

Reduced tax rate product categories

No specific digital goods or services have reduced tax rate

Exempted product categories

No specific digital goods or services are exempt

Reverse charge mechanism for B2B sales

Yes

Tax ID validation required

Yes

When do you have to register

Non-resident companies have to register as soon as goods are being delivered or services are being provided

Online registration possible

Yes

Local representative needed

Not mandatory

Registration procedure

To register for the Union scheme in Finland, you must:

Submit a registration notification through the MyTax online portal.
Have a valid Finnish VAT payer number.
Only businesses with an existing VAT registration in Finland can participate in the Union scheme.

List of digital and electronic services liable for tax

Electronic services: Digitally delivered services that are highly automated, require minimal human involvement, and depend on technology.
Broadcasting services: Audio or video content distributed simultaneously to the public by a media company with editorial control over programming.
Telecommunication services: Services for transmitting information electronically, including voice, data, and images, using technologies like wires, radio waves, or optical fibers.

Penalties

If you submit your tax return late, you’ll be charged a penalty. This penalty is €3 per day of delay, but the total maximum penalty is €135. This applies if your return is late for up to 45 days.

Registration threshold

No threshold, non-resident companies must register for VAT

Filing interval

Default is Monthly.

Quarterly if turnover < €100k;

Annual if < €30k.

Filing deadline

The 12th day of the second month following the tax period

(e.g., Jan VAT is due March 12).

E-invoicing requirements

Yes

Record keeping

Records must be kept for at least 10 years, including invoices and any documentation related to taxable supplies.

How-To Guides: Finnish SaaS VAT

Step: 1 Threshold

Effective July 1, 2003, Finland requires non-EU vendors (including online platforms) of digital services to
consumers (B2C) in Finland to register for and collect VAT, regardless of the sales amount. The
obligation was expanded to EU-established digital services providers effective January 1, 2015.
Effective January 1, 2019, Finland applies a VAT registration threshold of EUR 10,000 for EU-established
digital services providers. The threshold does not apply to non-EU businesses.

 

Finland-established businesses – VAT registration threshold: €20,000 taxable turnover.
Non-EU suppliers (no fixed establishment in Finland) – No VAT registration threshold for B2C digital services. Effective threshold: €0.
EU-established suppliers (cross-border B2C digital services) – EU-wide €10,000 threshold applies.

Step: 2 Business Registration

Business registration is handled by the Finnish Tax Administration (Vero). Foreign companies without a fixed establishment can register for VAT without a local business ID if only performing taxable sales where reverse charge doesn’t apply.

Step: 3 TIN/VAT Number

The VAT Number (format: FI99999999) is issued by the Finnish Tax Administration.

Step: 1 Standard VAT Rate

The standard VAT rate in Finland is 25.5% (increased from 24% in late 2024). SaaS/Digital services fall under this standard rate.

Step: 2 VAT Formula

To calculate your tax amount, apply the following formula:

 

Tax Amount = Net Price x 0.255

Step: 3 Reverse Charge (B2B)

Reverse Charge (B2B) applies to cross-border B2B services. If a foreign SaaS provider sells to a Finnish VAT-registered business, the buyer accounts for the VAT. The seller does not charge Finnish VAT.

Step: 1 Selling B2C

Seller must charge 25.5% Finnish VAT on B2C sales and remit it via the OSS or local Finnish VAT registration.

Step: 2 Selling B2B

When selling B2B in Finland, the seller does not charge VAT. The invoice must state the buyer’s VAT ID and a reference to “Reverse Charge.”

Step: 3 Invocing Requirements

The mandatory fields include:
• Date of issue & Sequential number
• Seller’s & Buyer’s VAT ID
• Full names and addresses
• Description of service (SaaS)
• Date of service/completion
• Taxable amount per rate
• VAT rate (25.5%) and amount
• If B2B: “Reverse charge” note.

Step: 1 Filing Interval

The default filing interval is monthly.

Quarterly if turnover < €100k; Annual if < €30k.

Step: 2 Filing Deadline

The filing deadline is the 12th day of the second month following the tax period (e.g., Jan VAT is due March 12).

Step: 3 Submission

Mandatory electronic filing is done via the MyTax (OmaVero) portal. Payments are made via SEPA bank transfer using a unique reference number.

Step: 4 Record Keeping

Records and invoices must be kept for 10 years (Electronic storage is permitted and preferred).

PayPro Global Solution: Simplified Registration & Fiscal Representation

Navigating VAT registration and fiscal representation in Finland can be daunting. PayPro Global acts as your Merchant of Record, handling these complexities, including VAT registration and fiscal representation where needed, so you can focus on your business.

Learn more about our MoR services.

FAQ

Overwhelmed by SaaS sales tax compliance?

Our team of SaaS tax experts is here to help. Contact us today for a free consultation. 

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