Tax rates in Finland for 2026 combine a progressive state income tax topping out at 37.50% on earned income above €52,100, a flat municipal tax between 4.70% and 10.90%, employee social insurance contributions of roughly 10.17%, a two-tier capital income tax of 30% and 34%, a corporate income tax of 20%, and a standard VAT of 25.5%. The full picture depends on where you live, what you earn, and what kind of income you receive.
Personal Income Tax
Resident individuals pay income tax to both the state and their municipality on earned income such as wages and pensions. Capital income follows a separate schedule.
State Income Tax Brackets for 2026
The state schedule has five brackets, with fewer brackets and a lower top rate than in 2025:
- Up to €22,000: 12.64%
- €22,000 to €32,600: 19.00%
- €32,600 to €40,100: 30.25%
- €40,100 to €52,100: 33.25%
- Over €52,100: 37.50%
These rates apply only to earned income.1Nordisk eTax. Tax Rates Applicable to Resident Individuals (of Finland)
Municipal Income Tax
Every municipality sets its own flat-rate income tax on taxable earned income after deductions. For 2026, rates run from 4.70% to 10.90% depending on the municipality. Because municipal tax applies from the first euro of taxable income with no progressive brackets, it often represents a larger share of a middle-income earner’s total tax bill than the state income tax does.
Church Tax and Public Broadcasting Tax
Members of the Evangelical Lutheran, Orthodox, or Finnish German church pay a church tax of 1% to 2.25% of taxable income, depending on the parish. Non-members pay nothing.
The public broadcasting tax funds Yle and works out to 2.50% of combined earned and capital income above €15,150, capped at €160 per year. Income below €15,150 owes nothing.2Tax Administration (Vero.fi). Public Broadcasting Tax and Åland Islands Media Fee
Social Insurance Contributions
Mandatory social insurance contributions come out of wages on top of income tax. For 2026, the employee’s share breaks down as follows:
- Pension insurance: 7.30% of gross wages. This is now the same for every age group; the higher rate that previously applied to workers aged 53 to 62 ended at the start of 2026.3Ministry of Social Affairs and Health. Social Insurance Contribution
- Health insurance: 1.98% total, split between a 1.10% healthcare contribution and a 0.88% daily allowance contribution.4Tax Administration (Vero.fi). Social Insurance Contributions
- Unemployment insurance: 0.89% of gross wages.
The total employee deduction comes to about 10.17% of gross wages.
Capital Income and Dividend Rates
Investment income and capital gains are taxed separately from wages at a flat two-tier rate: 30% on the first €30,000 of capital income and 34% on anything above. This covers profits from selling shares or real estate, rental income, and interest.5Tax Administration (Vero.fi). Selling Shares
Dividend taxation depends on whether the payer is listed or unlisted. For listed company dividends, 85% counts as taxable capital income and 15% is tax-free, with the company withholding 25.5% at source.6Tax Administration (Vero.fi). Dividends From a Listed Company
Unlisted company dividends follow tiered rules tied to the shares’ mathematical value. Within 8% of that value and below €150,000, only 25% of the dividend is taxable capital income and 75% is tax-free. Above €150,000, the split flips to 85% taxable. Any dividend exceeding 8% of the mathematical value is reclassified as earned income, with 75% taxable at the recipient’s marginal rate and 25% exempt.7Tax Administration (Vero.fi). Dividend From an Unlisted Company
VAT and Excise Duties
Finland’s standard VAT rate is 25.5%, which applies to most consumer goods and services and is built into sticker prices.8Tax Administration (Vero.fi). The Changes to VAT Rates
Two reduced rates apply. A 13.5% rate took effect on January 1, 2026, replacing the earlier 14%, and covers groceries, restaurant meals, books, medicines, passenger transport, accommodation, and admission to cultural and sporting events.9Tax Administration (Vero.fi). The Reduced VAT Rate of 14% Will Be Lowered to 13.5% in 2026 A 10% rate applies to newspapers and periodicals.10Finnish Customs. VAT Rates
Excise duties add per-unit charges on alcohol, tobacco, soft drinks, and fuels. Because they are calculated per liter, per cigarette, or per kilowatt-hour rather than as a percentage of price, they can add substantially to the final cost. Finland’s excise rates on spirits and cigarettes are among the highest in the EU.
Property and Transfer Taxes
Real estate tax is a municipal levy on the taxable value of land and buildings, and municipalities set their own rates within statutory ranges:11Tax Administration (Vero.fi). Value of Real Estate and Real Estate Tax Rates
- Land (general rate): 1.30% to 2.00%
- Permanent residential buildings: 0.41% to 1.00%
- Other residential buildings, including vacation homes: 0.93% to 2.00%
- Vacant building plots: 2.00% to 6.00%. Municipalities in the greater Helsinki area must set this rate at least 3 percentage points above their general land rate, subject to the 6% cap.
The taxable value is typically well below market value, so effective rates end up lower than the headline percentages suggest.
Buying real property triggers a 3% transfer tax on the purchase price. Buying shares in a housing company or other securities triggers a 1.5% transfer tax. Listed company shares are generally exempt, and property received through inheritance, gift, or division of marital assets is not subject to transfer tax.
Inheritance and Gift Taxes
Both taxes use progressive rates that vary with the amount received and the recipient’s relationship to the giver. Finland raised the tax-free thresholds starting in 2026.12Tax Administration (Vero.fi). What Will Change in Taxation in 2026
Inheritances below €30,000 are tax-free, up from the previous €20,000. Above that, close relatives (spouses, children, and parents) pay 7% to 19% depending on the total value; more distant heirs pay 19% to 33%.
Gifts below €7,500 from the same donor within a rolling three-year window are tax-free, up from €5,000. Above the threshold, close relatives pay rates starting at 8% on gifts up to €25,000 and rising for larger amounts. More distant recipients pay higher rates at every tier.13Tax Administration (Vero.fi). Gift Tax Calculator
Corporate and Employer-Side Taxes
Finland’s corporate income tax is a flat 20% on profits, competitive within the EU. It applies to limited liability companies, cooperatives, and other corporate entities.14Tax Administration (Vero.fi). Income Tax
Employers also carry the larger share of social insurance costs. The average employer pension contribution for 2026 is 17.10% of the employee’s salary, and the health insurance contribution is 1.91%. The employer’s unemployment insurance contribution is 0.31% on the first €2,509,500 of total payroll and 1.23% on amounts above that threshold. Combined, employer-side contributions add roughly 19% or more on top of each salary. A €50,000 salary can therefore cost a small employer closer to €60,000 all in.
Companies with taxable income of at least €50,000 also pay a public broadcasting tax of €140 plus 0.35% of income above that threshold, capped at €3,000 per year.2Tax Administration (Vero.fi). Public Broadcasting Tax and Åland Islands Media Fee
Which Rates Apply to You
These rates apply in full only to tax residents, who owe Finnish tax on worldwide income. You are treated as a resident if your main home and center of personal interests is in Finland, or if you stay in the country for more than six consecutive months.15Tax Administration (Vero.fi). Tax Residency, Nonresidency and Residency in Accordance With a Tax Treaty – Natural Persons Non-residents owe tax only on Finnish-sourced income and, for wages, face a flat 35% withholding rather than the progressive brackets above. Performing artists pay 15% instead.16Tax Administration (Vero.fi). Taxation of Employees From Other Countries