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VAT in Finland 2026: a complete guide for a small business

Published 29 September 2026

Finnish VAT for a small business comes down to six things. You register once your turnover passes 20 000 euros in a calendar year. You charge 25.5 %, 13.5 % or 10 %. Your invoices carry the entries the VAT Act lists. You file and pay by the 12th of the second month after each tax period. You deduct the VAT on what you buy for the business. And you keep the invoices for six years. Here is each step, with links to the articles that go into the detail.

1. Do you need to register?

Registration is compulsory once your turnover passes 20 000 euros in a calendar year, and VAT is due from the sale that takes you over the limit, not from the start of the year. In practice, register in good time when you are getting close, so that you are already registered on the day you pass it. You stay outside the register only while turnover is at most 20 000 euros in both the current and the previous calendar year. Below the limit you can register voluntarily and deduct the VAT on your purchases, but you then pay VAT on all your taxable sales.

What counts as turnover, and when you can leave the register, is in our article on the 20 000 euro VAT registration limit.

2. Which rate applies

The reduced rate was 14 % until the end of 2025 and has been 13.5 % since 1 January 2026. Alcohol and tobacco stay at 25.5 %, also in a restaurant. Some sales carry no VAT. Health care, for example, is exempt, and you cannot deduct the VAT on purchases for it. Sales of goods to VAT-registered buyers in other EU countries are zero-rated, and there you can deduct the VAT on your purchases.

3. What goes on an invoice

A VAT-registered seller must give an invoice for sales to businesses and other organisations, with the entries set out in the VAT Act, including the date, a running number, your business ID, both parties' names and addresses, what was sold, the taxable amount and the VAT by rate. Invoices up to 400 euros, and retail sales to consumers, can use a lighter set of entries. A business that is not in the VAT register must not show VAT on its invoices. The full list is in our article on invoice requirements.

4. Tax periods and deadlines

A due date on a Saturday or a public holiday moves to the next business day, and there is no extension to ask for. A longer period starts at the beginning of the year after you apply, and you must stay on a period for at least a year. File a return for every period, even one with no sales. Examples by month are in our article on VAT return deadlines, and what a late return costs is in our article on late VAT returns.

5. Which period a sale belongs to

By default, VAT belongs to the period in which the goods are delivered or the service is performed. A business whose turnover is at most 500 000 euros in a calendar year can choose the cash basis instead. VAT on a sale is then reported when the customer pays, and VAT on a purchase is deducted when you pay for it. An unpaid sale must still be reported in the month in which 12 months have passed since delivery. The cash basis covers only sales and purchases in Finland: not imports, exports, trade in goods within the EU, or cross-border services under the reverse charge.

6. Deducting VAT on purchases

You can deduct the VAT on goods and services you buy for the part of your business on which you pay VAT. The seller must be in the VAT register, which you can check at ytj.fi, and you need a proper invoice. A purchase used partly for other purposes, such as a van also driven privately, is deductible only for the business share, and you must be able to show that share, for example with a driving log.

Some purchases carry no deduction at all: commuting between home and work, entertainment, and housing used by the owner or staff. The VAT on passenger cars is deductible only in limited cases. Where the line runs for client lunches and staff parties is in our article on entertainment expenses.

7. Buying and selling across borders

• Services bought from abroad, such as ads and software, usually go on your return under the reverse charge: you report the VAT and, for a business with a full right to deduct, deduct it in the same return. See our article on reverse charge.
• Services sold to a business in another EU country are usually taxed in the buyer's country. Your invoice says "Reverse charge" and shows the buyer's VAT number, and it must be issued by the 15th of the month after the service. These sales do not count towards the 20 000 euro limit in Finland.
• Goods sold to a VAT-registered buyer in another EU country are zero-rated with the buyer's VAT number on the invoice, again issued by the 15th of the following month.

8. Keeping the records

Keep your sales and purchase invoices for at least six years, counted from the start of the year after the calendar year they relate to; if your financial year is not the calendar year, count from the end of the financial year instead. The Tax Administration must be able to see them in Finland without undue delay. How long each kind of receipt is kept is in our article on receipts and record keeping.

When someone else runs it

VAT is easy to get right when the books are current. In our monthly bookkeeping we tell you the VAT amount before the due date and file the return for you, quiet months included.

Sources

• Tax Administration: how to register for VAT
• Tax Administration: rates of VAT
• Tax Administration: when to file and pay VAT
• Tax Administration: tax period
• Tax Administration: cash-based VAT (in Finnish)
• Tax Administration: deducting VAT on purchases
• Tax Administration: VAT invoice requirements, detailed guidance

Please note: this is general information about Finnish rules, not advice for your own situation, and the rules change. Ask us before you act on it.

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