When moving from abroad to Finland it is important to review the tax consequences of the move. Moving to Finland may change person’s tax status and it may affect taxation of certain income. On the other hand, even though there were no changes in the tax status and the income was taxed the same way as before move, the taxpayer will have at least notification and registration liabilities. It’s important to take care of these liabilities to ensure that the tax process goes as fluently as possible.
The reasons for moving and consequences in taxation
From the tax point of view, it’s essential to go through the reasons for moving. Tax status of a person is always determined based on the actual situation. It is important to know e.g. is the move temporary or permanent and what is the reason to stay in Finland.
A temporary move to Finland doesn’t usually change person’s tax status in Finland. A person will not be considered to be tax resident in Finland if his permanent home is not considered to be transferred from abroad to Finland, and his continuous stay in Finland doesn’t exceed six months. A non-resident taxpayer is liable to pay taxes to Finland only on income received from here.
However, if person’s permanent home is considered to be transferred to Finland or his continuous stay in Finland exceeds six months, the person will be considered tax resident here. Resident taxpayer is liable to pay taxes to Finland on worldwide income. This means that a change in the residual status may have a significant meaning in taxation.
It’s advisable to review tax effects as early as possible and preferably already before moving.
Things to consider when moving to Finland
Here is an example list of things that should be considered when moving to Finland.
- What’s the nature and the reasons for the move?
- What are the registrations and notifications that need to be done in Finland and in the other country?
- What happens to tax residency in Finland and in the other country?
- How is income taxed in Finland and the other country after leaving Finland?
- How and in what extent does the tax return need to be filed in Finland and the other country?
- How does the social security go on?
It’s significantly easier and safer to settle in Finland when the tax questions are under control already before moving. We have many years of experience of international personal taxation and excellent contacts to other countries through our Nexia International network. The best advice is to contact us – we’re here to help you.