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Damalion Finland desk 

Doing business in Finland 

Situated in Europe, Finland is a Nordic country with 338,000 square kilometres and a population of approximately five and a half million. In terms of area, Finland is one of the largest countries in Europe and its official languages are Finnish and Swedish. 

Being one of the largest countries in Europe, Finland is an ideal choice for foreign investors looking to move to a different country and change their portfolio. 

It has a high quality of life and economic competitiveness, which makes the country an incredible option for investors. 

In terms of international competitiveness, Finland rates highly in several important categories, including innovation. Finland is a developed economy with a thriving private sector and a business environment that is highly conducive to foreign direct investments. And its government is welcoming of business-minded individuals. 

Benefits of Doing Business in Finland 

  • Finland has a flourishing economy and a well-educated workforce, and its rankings in terms of global competitiveness are very remarkable. 
  • Finland is one of the least corrupt nations, whereby all the policies are transparent. And it provides an excellent environment for entrepreneurs. 
  • Finland is a technologically developed country. So the country is digitalized and this makes doing business processes easy. 
  • Finland’s Judiciary System has succeeded in maintaining a peaceful environment, and this made the corruption rate very low. 
  • Finland has a low corporate income tax rate, it also has several tax incentives for businesses. 
  • Its workforce is hardworking and highly credible for its projects. 
  • Finland ranks well in terms of global competitiveness and innovation. And its standard of living is one of the highest in the world. 
  • It has an excellent healthcare system, a renowned education system, and great social facilities, in addition to a hugely effective telecommunications industry. 

Finnish law is founded on the civil law tradition. However, being a member of the European Union, the EU law is applicable and takes priority over national legislation in Finland. The Finnish legal system is based on the standard of the rule of law.

And because of the close relation regarding the development of the legal systems in the Nordic countries, correspondences can be found.

Under the Finnish legal system, the Finnish Limited Liability Companies Act specifies the procedure of establishing a company and includes basic provisions respecting the administration. Same, under the Finnish legal system, the Finnish employment legislation gives employees a high level of employment protection rights. The Finnish legal system also protects intellectual property rights.

Entity Choice

Finland is welcoming of direct foreign investments, and there are no restrictions put on it, although authorization is mandated in specific regulated sectors such as :

  • investment services,
  • banking,
  • fund management and
  • payment services.

Additionally, foreign investments in defense industry companies and security sector companies are subject to a crucial authorization process.

For investors, the most common legal forms when doing business in Finland are the following:

Private entrepreneurs (toiminimi)

This is the simplest and the most popular way to establish a new business in Finland. 


  • This business type is easy to operate and imposes minimal documentation 
  • Under this business, only one person is required to start operating under a company name 
  • Starting a business in this way is quick and simple. 
  • it is not crucial to have a minimum amount of capital. 
  • They apply to small businesses that do not impose much investment. 
  • Decision-making belongs to the entrepreneur, and the company may employ workers. 

Limited company (osakeyhtiö) 

Being the most popular company form in Finland, a limited company is a reasonable way to organize a business if you want to invest a lot of money. It is also applicable to all kinds of business operations. 


  • It needs to be established by at least a natural or legal person. So you can set it up on your own or with others. 
  • It doesn’t impose a minimum share capital to get started 
  • It must be documented at the Trade Register before starting an activity. 
  • It is a good way to minimize risk and lower taxes. 
  • Its liability is restricted to the capital contributed 
  • It involves a lot of paperwork, so it is advisable to get professional advice and a good accountant. 
  • It has a management board that provides the management. 

General Partnership (avoin yhtiö) 

This is a company structure that is formed when two or more individuals agree to it by signing a partnership contract. 


  • It must be formed by at least two individuals (one of the individuals must be an EEA resident) 
  • there is no minimum amount of capital assigned 
  • each member of the partnership responds for the responsibilities, liabilities, and debts of the company. 
  • The profits are divided among the partners in accordance with their shares 
  • all partners have equal status in all the company’s activities. 

Limited partnership (kommandiittiyhtiö) 

This form of partnership differs from a general partnership in that it requires at least two partners, of which one must be the general, and the other a silent partner, who commonly plays the role of investor. 


  • at least two partners are needed. 
  • There are no minimum capital requirements mandated to set up the business. 
  • one of the members is responsible for the debts and duties of the company. 
  • The general partner has the right to participate in the management’s decisions and ask for profit 
  • The silent one has no decisional authority and also does not absorb the damages 

Cooperative association (osuuskunta) 

This is a Finland company structure that is owned by its members. It is most suitable for collaborative entrepreneurship, and its main purpose is to support the economic activity of its members. 


  • At least 3 founders are required and can be private individuals, foundations, or other legal persons. 
  • they do not have any fixed or minimum capital requirements, so the amount of total capital differs depending on the number of members. 
  • The liability of the members of a Cooperative is limited to their investment of share capital. 
  • The value of the shares is determined by the founders and participation shares have to be of equal value. 
  • The Board of Representatives takes care of all management tasks. 
  • The Board of Directors establishes the rules and regulations 
  • The company can also hire an accountant to handle members’ finances. 


Public Limited Company in (julkinen osakeyhtiö) 

This form of company is generally used by larger companies. 


  • The company requires at least one shareholder. 
  • the share capital must be at least 80.000 euros 
  • It is established after registration in the Trade Register 
  • its board must constitute at least a CEO and three board members. 
  • it must be listed on the Helsinki Stock Exchange. 
  • It is required to publish interim and annual reports on its results. 

Branch of a Foreign Company (sivuliike) 

This is a company structure that operates in Finland while its headquarters is in another country. The branch’s representative must be domiciled in Finland, and special permission must be approved by NBPR (National Board of Patents and Registration) if it is not an EEA member. 

Establishing a company in Finland can be a lengthy and complicated process, therefore, it is advisable to seek advice from a professional and reliable entity, e.g. Damalion. Contact your Damalion expert now to set up your Company in Finland. 


    Finland is not only known as one of the happiest countries on earth but it’s also known for its strong banking sector. 

    The Finnish banking sector, which is mainly focused on retail, universal, and corporate banking, is depicted by a strong presence of pan-Nordic banking groups in Finland associated with strong local financial and banking groups, and specialized institutions. According to the Finnish Financial Supervisory Authority, the Finnish banking sector’s capital ratios are stronger than the European average. 

    There is a vast range of banking and financial network in Finland. The banking and financing business is regulated by the Central Bank (Bank of Finland – Suomen Pankki), while other banks and other financial institutions are under government supervision. 

    The Bank of Finland, which is Finland’s monetary authority, is a member of the European System of Central Banks, and of the Eurosystem. It is also responsible for the country’s currency supply and foreign exchange reserves. 

    Opening a Finnish Business Bank account

    As an entrepreneur, if you’re planning on setting up residence in or doing business in Finland, it is highly recommended to get a Finnish bank account. Thankfully, the process is relatively straightforward. All that is required is a valid ID, and proof of address. You’ll also need to provide some basic information about yourself and adhere to KYC/AML procedures. 

    If you want to open a bank account in Finland in order to facilitate your business activities, contact your Damalion expert now and let us help. 


    Finland is one of the best countries in the world in terms of living conditions. It has a brilliant economy and most businesses in this country progress very well. 

    Finland is a wonderful country for many investors. It comes with a high standard of living and is far away from most political crises. So, obtaining 

    Finland residency is never a bad idea, rather, there are a lot of benefits. But, business immigration there is tough. Finland doesn’t give passive residence by golden visas to high net worth people or investment programs and is strict with who it accepts. This doesn’t make it impossible though. 

    Getting Finnish residency 

    If you want to stay in Finland for more than three months, you require a residence permit. There are different paths to obtaining Finland residence permits: 

    • Residence permit for work: an individual requires a valid work contract to qualify for this type of permit. This visa is commonly valid for a year, but, at times it can be granted for the validity of the work contract. 
    • Residence permit by investment: foreign entrepreneurs interested in moving to Finland can access Finland’s investor visa program that allows them to live and have their corporations there. 
    • Residence permit for studies: this is a student residence permit, which is valid for two years. This can be switched to a work permit after studies. 
    • Residence permit for family ties: this residence permit is granted to individuals who have family members residing in Finland. 

    In Finland, residency by investment takes the cake when it comes to entrepreneurs and high-net-worth individuals. To gain Finnish residency through this program. An individual will need to start up a business, pass through some eligibilities, and then cross over to Finland citizenship. 

    Getting Finland Residency by Investment 

    To qualify for Finland’s investment visa, an individual must become self-employed and set up a business there. Starting up a profitable business in Finland is a big investment. But, the government would make up for this by granting you residence as a business owner if you meet up certain requirements. 

    Below are the criteria to meet: 

    • You must become an entrepreneur, and your business must have a Trade Register 
    • You must not be a danger to the public 
    • The business must be a profitable one, so for this reason, you must draft a business plan that will be evaluated by the applicable authorities. 

    Starting a business in Finland comes with plenty of benefits, among which is access to one of the most abundant markets in Northern Europe. And by immigrating to Finland by investment, you can also move with your family. 

    After obtaining the residence permit, an applicant can acquire permanent residency. After 5 years of permanent residency, an entrepreneur can apply for Finnish citizenship. 

    The process of getting Finland’s residency by investment is quite intricate however, Damalion can guide you through the entire procedure. just contact us now. 


    Taxation in Finland is primarily carried out through the Finnish Tax Administration. 

    In Finland, taxpayers may either be residents or non-residents. Individuals are considered tax residents in Finland if they have a home or have stayed there for over six months. And as a taxpayer, you pay taxes on your salary and other income. And as a foreigner who comes from abroad to work in Finland, your taxation will be influenced by how long you will stay in Finland and whether your employer is a foreign company or Finnish. 

    Finland residents are taxed on their worldwide income at several rates, plus flat rates for municipal taxes and church taxes. The tax amount will rely on how much income the taxpayer receives. But non-residents are taxed only on their Finnish income at 35% unless International tax treaties apply. 

    Taxes In Finland 

    Personal Income Tax in Finland 

    Finnish tax residents pay tax on their worldwide income, while non-residents pay tax on income from sources in Finland. The personal tax rate in Finland ranges from 0-31.25% 

    Corporate Income Tax in Finland 

    Corporate income tax in Finland is paid on the company’s worldwide income. Corporation tax is paid on yearly taxable income minus tax-deductible expenses and losses, and the tax rate is 20%. 

    VAT (ALV – arvonlisävero). 

    In Finland, VAT (Value Added Tax) is an indirect tax evaluated as a percentage of the value of all goods and services, unless particularly exempted. It is a tax paid by the end consumer, and its standard rate is 24%. But reduced rates of 14 and 10 percent apply to some goods and services. 

    Municipal Property Tax 
    In Finland, the annual immovable property tax is set by municipalities, and the tax rates range from 0.41% to 2%, but those rates may be higher for new areas. 

    Local Income Tax

    Municipal tax is charged at flat rates on the taxable income specified for municipal taxation. The rate ranges between 16.50% and 23.50%, relying on the municipality. 

    Property Transfer Tax 

    In Finland, there is a 4% property transfer tax for property, and when transferring company shares, the tax is paid at the rate of 1.6%. There are certain exceptions, such as first-time home buyers’ homes. 

    Inheritance and Gift Tax 

    Finnish Inheritance and Gift tax are charged on the market value of the inherited property or donated object. The tax rates will depend on the level of relationship between the parties and on the price of the property. 

    Social Security Contributions 

    Every employee and their employer in Finland is expected to pay into specific social funds. The tax rate will depend on the income of the employee. And for Employer, it’s 20.3% on average.

    Church taxes in Finland 

    In Finland, taxes are collected from members of the Evangelic Lutheran, Orthodox, and Finnish German churches at flat rates on the taxable income defined for municipal taxation. The rates vary between 1% and 2.2%, depending on the municipality and the parish concerned. Individuals that are not members of these churches are exempted from paying. 

    International tax treaties 

    Presently, Finland has double tax treaties with over 80 countries. The tax treaties pursue the OECD Model Tax Convention on Income and Capital and are applied in agreement with the OECD commentary. These tax treaties prevent the occurrence of double taxation on an individual taxpayer’s income. 

    Finland has Double Tax Treaties (DTC) with several jurisdictions including Argentina, Australia, Azerbaijan, Belarus, Brazil, Canada, China, Egypt, Georgia, Germany, Hong Kong, Iceland, India, Indonesia, Israel, Italy, Latvia, Luxembourg, Macedonia, Malta, Mexico, Morocco, Netherlands, Republic of Korea, Singapore, Slovenia, South Africa, Sweden, Switzerland, Thailand, Turkey, Turkmenistan, Ukraine, United Arab Emirates, United Kingdom, Zambia. 

    Finland has Tax Information Exchange Agreements (TIEA) with jurisdictions including Aruba, Beliz, The Bahamas, British Virgin Islands, Cayman Islands, Dominica, Grenada, Isle of Man, Liberia, Macao, Monaco, Netherlands Antilles, Seychelles, St. Lucia, St. Vincent and the Grenadines, and Vanuatu. 

    Finland offers many desirable opportunities to grow business. However, the tax statutes can be complex and require time-consuming research. But with your Damalion expert by your side, the complicated legwork will be simplified so that you can focus on your business goals. Contact us now and let us help. 


    Intellectual property rights’ goal is to encourage innovation and creation and depict the foundation of business and profitable activities. In Finland, 

    Industrial property rights and copyrights belong to intellectual property rights. And the most important industrial property rights are patents, utility models, trademarks, and design rights. 
    Intellectual property protection in Finland 

    Intellectual property protection in Finland 


    A patent gives a right to restrict unauthorized exploitation, which includes the manufacturing, offering, and use, of the patented invention in Finland. 
    To be insured, an invention must either be novel, involve a creative step, or be capable of industrial application. 

    Subject to the payment of renewal payments, protection lasts for 20 years. On application, the period of protection for inventions regarding pharmaceutical products and plant protection products may be extended by five years. 


    This is an intellectual property right that arises as a result of an individual’s creative activities, and it gives the author an exclusive right to determine specific uses of his or her work. 

    The main theme of copyright is that a copyright-protected work may only be utilized with the approval of the author and in the way, the author has authorized within the spectrum of the exclusive rights consented to the author. 

    The theme of copyright protection is a written, oral, or artistic work that meets the limit of being identified as a work. 

    As a common rule, copyright protection expires 70 years after the author’s death. Copyright protection subsists automatically and does not need registration.

    Trade Marks 

    The right to a trademark gives the sole right to prevent others from using it. To be protected, a sign must be unique. A Finnish trademark registration will expire after 10 years from the date of registration and is renewable indefinitely for continuous ten-year periods. In Finland, a trademark is regarded as established when it is normally known in its applicable target group as a trademark of the goods or services of the owner. 

    Registered Designs 

    The design right gives the right to prevent others from manipulating the protected design. To be registered, a design must be novel and have individual characters. Its protection lasts for five years and is renewable for four extra five-year periods. 

    Utility Models 

    Utility models are inventions that can either comprise a technical solution that can be industrially applied, be novel, or distinctly vary from what has become recognized before the date of filing of the utility model application. 

    Its protection gives the right to restrict others from commercially exploiting the technical solution insured by the utility model. Its protection lasts for four years from the date of application and is renewable twice. 

    Do you require more information on Finnish IPR legislation, contact your Damalion expert now. 



    When hiring employees in Finland, employers need to follow the country’s employment law. One of the most important is the protection of employees. Most provisions in Finnish employment laws are critical and set the minimum level for the terms of employment. When employing, the most important thing to remember is that you, as an employer must always provide employees with a written contract, as this will define their rights and obligations.

    Employment Contracts in Finland 

    An employment contract is an agreement between an employer and an employee. An employment contract states the ‘principal terms of work’ upon which the employee agreed upon.

    An employment contract may be concluded verbally, electronically, or in writing. Completing the employment contract in writing is in the interests of the employer and employee because the terms and conditions of the arrangement can be reliably validated later. Written should cover details such as business location, place of work, the termination date, employee’s duties, salary, annual holiday, and sick pay.

    There are several types of employment contracts in Finland. The main types are the following:

    • Indefinite employment contract: this is the most common type of contract in Finland, and it is valid for an indefinite period.
    • Fixed-term employment contract: fixed-term employment will end at a point in time established in advance. A fixed-term work contract can only be made for a justified reason, and these usually include temporarily replacing staff or seasonal work. A fixed-term employment contract expires when the agreed period comes to an end.
    • Hybrid contracts: when indefinitely valid and fixed-term contracts are fused, a “hybrid” contract is born.
    • Trial period employment contract: this type of contract must not surpass six months from the start of work.

    Regardless of the contract type choosen, the employee should receive essential information within a month. Also, when concluding employment contracts, employers should evaluate their need for a workforce and the requirements of their business.

    Employee benefits in Finland 

    In Finland, Employees are entitled to the following statutory benefits.

    • Social security: per the Finnish social security system, all employers and employees in Finland must contribute to social insurance funds. These funds will cover some employment and unemployment benefits.
    • Working hours: the work hours in Finland are stated in the employment contract. The working hours in Finland are governed by the law and are 40 hours per week. The maximum number of hours each individual should work in Finland, including overtime, must be an average of 48 hours weekly for four months.
    • Holiday: in Finland, all employees are privileged to holidays. The number of days will depend on the employment contract. But generally, employees should have 24-30 paid leave days annually. They can also have 11 paid public holidays off.
    • Healthcare benefits: in Finland, employers provide healthcare benefits to employees and these include preventive healthcare, such as medical care and processes.
    • Maternity/Paternity leave: maternity leave in Finland can start at any time, not earlier than 50 days, and not later than 30 days before the due delivery date. Partners have up to 54 days of unpaid paternity leave before the child turns two years.
    • Education leave: employees with at least one year of service to their employer can take two years of leave to further their studies. To be qualified to study leave, the employee’s studies need not be related to the organization for which they work.
    • Pension: every individual working in Finland has the right to receive an occupational-related pension when entering retirement age.


    In Finland, termination notice will vary depending on how long the employee’s service is. This is usually specified in the employment contract.

    So, are you thinking of entering the Finland market?

    Being an international consulting firm, Damalion provides several business solutions, and these include compliance, entity management, accounting, taxation, payroll support, and many more across the world.

    If you wish to learn more about our services and how we can assist you, contact us today. Our Damalion Finland Desk will answer you shortly.

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