Ennakkoverotus
Ennakkoverotus is the Finnish system by which taxes for the coming year are collected in advance through the tax administration, Verohallinto. It is based on an estimate of the taxpayer’s annual income and deductions and determines how much tax should be paid during the year. The central instrument is the ennakkoverokortti (prepayment tax card), which shows either a percentage rate of income tax or a fixed annual amount to be withheld. In practice, employees have the prepayment tax automatically withheld by employers according to the card; pension payments and other sources of income may also have taxes withheld. If you have income not subject to withholding, you may be required to pay ennakkovero in advance, typically in monthly or quarterly installments.
The tax authority usually bases ennakkoverotus on the previous year’s data and on any changes reported by
At year end, the actual income and deductions determine the final taxation; the difference between the prepayment