Finland Corporate Tax Guide 2026 (Yhteisövero)
Finland applies a flat corporate income tax rate of 20% on taxable profits. The corporate tax system includes group contribution rules, loss carry-forward provisions, and a comprehensive tax treaty network.
Corporate income tax in Finland (yhteisövero) is levied at a flat rate of 20% on all taxable profits. This rate has remained stable since 2014 and applies to limited liability companies (osakeyhtiö, Oy), cooperatives, and other corporate entities. Finland's corporate tax system is competitive by European standards — the average EU corporate tax rate is approximately 21.5% in 2026.
Taxable Income
Taxable income is calculated as the difference between all business income and allowable expenses. Finnish tax law generally follows the accounting profit with specific tax adjustments. Depreciation follows declining-balance method: 25% for machinery and equipment, 4-7% for buildings depending on type. Research and development costs can be deducted immediately or capitalised and depreciated over 3-5 years. Interest expenses are generally deductible, but thin capitalisation rules limit deductions when net interest exceeds €500,000 and the debt-to-equity ratio is above certain thresholds.
Group Contributions (Konserniavustus)
Finland has a unique group contribution (konserniavustus) system that allows tax-efficient profit shifting within a Finnish group of companies. A parent company can make a deductible contribution to a Finnish subsidiary, or vice versa, provided the parent owns at least 90% of the subsidiary's capital. The recipient includes the contribution in its taxable income. This system serves as a functional equivalent to group taxation or consolidated tax returns, allowing losses in one group company to be offset against profits in another. The contribution must be in cash and must be made during the same tax year. Both companies must have the same accounting period.
Dividend Distribution
Dividends paid by a Finnish company to its shareholders are not deductible for corporate tax purposes. The distributing company does not withhold tax on dividends paid to Finnish resident shareholders. For non-resident shareholders, Finland imposes a 20% withholding tax on dividends, which may be reduced under an applicable tax treaty. A domestic withholding tax of 25.5% applies to dividends paid to Finnish entities in certain non-cooperative situations.
Loss Carry-Forward
Tax losses may be carried forward for 10 years following the year of the loss. Losses incurred after 2012 have a 10-year carry-forward period. The annual utilisation of carried-forward losses is generally unrestricted, but anti-avoidance rules apply if there is a change of ownership and the company's business activities have substantially changed. Losses may be forfeited if more than 50% of the company's shares change ownership and the company is inactive or engages in different business activities after the ownership change.
Filing and Payment
Corporate tax returns must be filed within four months of the end of the accounting period. The tax year is typically the calendar year, but a different accounting period can be used. Advance tax payments are required during the tax year, calculated based on the previous year's taxable income. The final tax is assessed after the return is filed, and any balance is due within 30 days of the assessment. Late filing penalties start at €45 and increase progressively. Electronic filing through the OmaVero service is mandatory for all corporations.
International Taxation
Finland has an extensive network of over 70 tax treaties. Finnish resident companies are taxed on worldwide income, with foreign tax credits available for taxes paid abroad. The participation exemption regime applies: 75% of dividends received from EU/EEA resident companies are tax-exempt (subject to conditions). Capital gains from the sale of shares in qualifying subsidiaries are also tax-exempt under the participation exemption. Finland has implemented OECD BEPS measures, including country-by-country reporting for groups exceeding €750 million in consolidated revenue.
FAQs
What is the corporate tax rate in Finland for 2026?
The corporate income tax rate is a flat 20% on taxable profits, unchanged since 2014.
Can foreign companies have a branch in Finland?
Yes, foreign companies can operate through a permanent establishment (branch) in Finland, which is taxed at the same 20% rate as Finnish companies.
What are the penalties for late filing?
Late filing penalties start at €45 for a short delay and increase progressively. Interest on late payments is charged at the reference rate plus 7 percentage points.