Korkovähennys

Korkovähennys is a Finnish term that translates to "interest deduction" or "mortgage interest relief." It refers to a tax benefit available in Finland that allows individuals to deduct a portion of the interest paid on their housing loans from their taxable income. This deduction aims to reduce the burden of housing costs for homeowners and is a significant feature of the Finnish tax system.

The rules and limitations regarding korkovähennys can change over time, as they are determined by Finnish tax legislation. Generally, the deduction applies to interest paid on loans taken out for the acquisition or renovation of a primary residence, or a second home that is rented out. There are specific limits on the maximum amount of interest that can be deducted annually. The exact percentage of the deductible interest and the maximum deduction amount are subject to annual adjustments by the Finnish government.

To claim the interest deduction, individuals must report the interest payments made on their housing loans to the Finnish Tax Administration (Verohallinto) as part of their annual tax return. The tax authority then calculates the actual deduction based on the provided information and the prevailing tax laws. This benefit effectively lowers the overall tax liability of eligible homeowners, making homeownership more financially accessible. It is important for taxpayers to consult the latest information from the Finnish Tax Administration or a tax professional to ensure they are claiming the deduction correctly and in accordance with current regulations.