What you need to know about the new accounting and tax reforms 2025

In 2025, several significant changes to accounting, taxation and financial management will enter into force in Finland. They will affect both entrepreneurs and households. Here is a brief summary of the most important reforms:

1. Tax cards come into force at the beginning of the year

The tax cards will no longer be valid from February, but will come into force from 1 January 2025. In addition, the income limits on the tax card will now be calculated for the whole calendar year, making it easier to predict and monitor the tax rate tax.fi.

2. Taxation of income and the household income tax credit

The state income tax scale was increased by 3.4 % with an index adjustment, marginal tax rates were adjusted and the basic and earned income tax deductions increased tax.fi. On the other hand, the maximum amount of the household allowance has been reduced to €1 600 per year and the deduction percentages have been tightened. tax.fi.

3. Input tax and declarations

Income over €7 000 subject to advance tax (e.g. rental income) can now be put on a tax card instead of an advance if you wish tax.fi. Entrepreneurs to receive SMS notification of the due date for business tax returns - to reduce the need for paper reminders tax.fi.

4. Interest on late payments and compensatory interest

The interest rates payable on late payment of invoices increased: collection rates for all taxes rise from 11 → 11.5 % and collection rates for debt collection income from 7.5 → 8 % . tax.fi.

5. Value added tax (VAT)

The general VAT rate was increased from 24 % → 25.5 % in September 2024, and the changes will continue to affect accounting systems in 2025 tax.fi. In addition, several goods and services (e.g. pharmaceuticals, accommodation, sports and cultural services) moved to a VAT base of 10 % → 14 % at the beginning of the year.

6. Corporate taxation - the impact of the growth package

On 24 April 2025, the government decided to reduce the corporate tax rate from 20 % → 18 %, with the aim of boosting investment and competitiveness. The change is due to enter into force in 2027 and the loss deduction period will be extended from 10 → 25 years to 2026 .

7. Corporate and arrangement tax

Tax neutrality rules will be relaxed: more cash linked to share swaps may be allowed in the future, facilitating mergers and acquisitions. .

How should you prepare for these changes?

• Update your accounting system: make sure that the VAT rates and automations in the software you are using are up to date.
• Follow the tax card changes: check your tax card details in MyTax at the beginning of the year.
• Take advantage of the advance tax options: in particular, rental income earners will benefit as appropriate.
• Optimise the taxation of your business: extended loss relief and lower corporation tax can significantly improve the profitability of your business - take advantage of these in a planned way.

These reforms have a surprisingly broad impact on both everyday life and business. A proactive accounting and finance partner will help you navigate the changes, ensure compliance and effectively reap the benefits of tax reforms.

Please contact us if any of these are still on your mind!