A new year has started and the Finnish Tax Administration has yet again sent new tax cards for every person aged 15 or older. The previous years’ tax card is still valid for January of 2016, but starting from 1.2.2016 every person must deliver their new tax card to their employer. This news serves as a minor reminder for both the employee and employer about the tax card related procedures.

Employee


Every person in Finland aged above 15-years should receive their new tax card for the year 2016 in January. This new tax card would be valid from the start of February of 2016, and should be delivered to the employer as soon as possible.

Generally the new tax card is suitable as it is delivered, but the employee should always check the revenue and deductions that are the basis for taxation. If there are notable differences with the values presented in the tax card, you can inform the tax administration of the changes and print a revision tax card at Tax Card Online 2016.

Employee should always keep in mind that changes to the tax card can be made throughout the year. Thus if there is only a minor difference in the values presented in the Tax card, it would be preferred to move the filing of changes to a later point in time rather than at the start of the year.  This way you can prevent the build-up of traffic on the Tax administration systems. It should also be noted that minor changes in the employee wage income don’t often have an effect on taxation, thus making the majority of minor tax card revisions pointless.

The following information required for revised tax card:

1.Your projected income for the entire calendar year: Estimate your income for the entire calendar year, and specify your wage income, pensions and benefits. This is because pensions and benefits don’t share the same deductions and tax treatment as wage income.

2. Your actual income and taxes withheld since January 1st: Have information on your actual income and the amount withheld since the start of the year. This information must be given as gross amount, thus you should not subtract the withholding.

3. Any tax-deductible costs that you might have: For example, estimate the deductible travel costs, home and student loan interest rates and union payments.

Employer


As the year changes the employees receive their new Tax cards from the Tax Administration. For the January of the New Year, employer can use the previous years’ withholding tax rates for calculation of Januarys’ salaries. Unless the employee delivers and requests the use of the new tax cards withholding tax rate.

The Finnish regulation for prepayment has been changed for year 2016, in way that the employer can now receive the withholding information directly from the Finnish Tax Administration. Utilizing this method means that the employee does not need to deliver their new tax card to the employer. You can read more about the system here.

Summary of information the employer must provide to employees:

  1. Employer has received the withholding tax information electronically from the Tax Administration
  2. How the employer request the new Tax card from the employee, if employer does not receive the information electronically.
  3. Employer will automatically use the option A of Tax cards’ withholding tax for primary employment.
  4. If the employee requests the use of option B, employer must inform how he wants to receive this information. For example. Oral statement, written statement or by e-mail.

More on the subject at Finnish Tax Administration.