Contracting in Finland
Are you planning to be contracting in Finland? What you need to know before becoming a Finnish contractor? These pages will give you an overview about Finland as a country, what’s required of you to work in Finland, how to apply for Visa and Work Permit if necessary, the percentage of the Finnish Income Tax and how the Finnish Social Security works. For more practical information about contracting in Finland and Finnish Contractors’ requirements, download our free guide Start Contracting in Finland by clicking here.
Finland is located in North Europe and borders with Russia, Norway, Sweden and Estonia. The surface area of Finland is 338,432 km² and includes the land and inland water areas. It is heavily forested and contains thousands of lakes, numerous rivers, and extensive areas of marshland. Except for a small highland region in the extreme northwest, the country is a lowland less than 600 ft (180 m) above sea level. Off the southwest coast are the Swedish-populated Åland Islands (581 sq mi; 1,505 sq km), which have had an autonomous status since 1921. The political system is a parliamentary republic with several parties and usually with coalition governments.
History of Finland
Finland was a former part of Sweden until 1809, then they were the autonomous grand duchy within the Russian empire. It actually had become independent since the 6th of December, 1917. Soviet Union attacked Finland in 1939. It was again at war with the Soviet Union in 1941-44 but managed to remain independent. Nevertheless, they lost most of their Finnish Carelia, including the second-largest Finnish city Viipuri. After the war Finland was compelled to a sort of military pact with the Soviet Union. Therefore, In Western countries Finland was often regarded almost as a satellite of the Soviet Union. Nevertheless, Finland still managed to preserve its economic and political system.
Culturally Finland has always been part of the Western civilisation and also one of the Nordic countries (together with Sweden, Norway, Denmark, and Iceland). However, it has had and still has special features due to the separateness of the Finnish language and geopolitical location as a neighbour of Russia.
In addition, Finland joined the European Union (EU, former EEC or EC) the 1st of January, 1995. It became also a part of the Economic and Monetary Union (EMU), too. From year 1999, the national currency unit markka (abbr. mk or FIM) was a unit for the currency euro, with a fixed conversion rate 1 euro = 5.94573 marks and therefore, the euro is the only valid currency since March 2002.
Despite the fact that Finland was industrialised relatively late, mostly after the World War II. Finland is fairly competitive not only in pulp and paper industry but also in metal industry and electronics.
How to start contracting in Finland?
Work Requirements in Finland
In general citizens of the vast majority of EU/EEA member states do not need any special permit in order to undertake paid employment in Finland. Citizens of newer members of the EU (generally states that joined in 2004 onwards) must register with an employment office. If the duration of employment is longer than three months, EEU/EEA citizens must only register their right to reside in Finland at a local police station. This does not mean they require a special residence or work permit.
Read more about Work Requirements in Finland.
Finnish Visa and Work Permit
EU, EEA and Swiss citizens` national identity cards and passports only need to be valid for the actual period of the stay in the Finland. You will not need a visa if you are a citizen of a Nordic country or EU Member State. Similarly, you are not required to apply for visa if you are a citizen of a visa-free country and you have a valid passport or comparable travel document.
Read more about Finnish Visa and Work Permit.
Finnish Income Tax
Taxable income for non-residents and investment income are subject to tax at flat rates and an employment income for residents and other earned income for both residents and non-residents are subject to both municipal income tax and national income tax.
Read more about Finnish Income Tax.
Finnish Social Security
In general, there are several contributions covered by employer and employee. Permanent residents of Finland have to pay health insurance contributions, medical care fee (1.19%) and daily allowance contribution (0.82%).
Read more about Finnish Social Security.