Toiminimiyrittäjänä

Toiminimiyrittäjänä refers to operating a business as a sole proprietor in Finland. This is the simplest and most common form of business for individuals starting out. When an individual establishes a business as a toiminimiyrittäjänä, they are personally responsible for all business debts and obligations. There is no legal distinction between the business and the owner.

Starting a toiminimi requires registration with the Finnish Patent and Registration Office (PRH) and the tax authorities. The owner is responsible for their own taxes, including income tax and value-added tax (VAT) if applicable. They must also handle their own social security contributions, such as pension and health insurance.

The income generated by the toiminimi is considered the owner's personal income and is taxed accordingly. Expenses incurred for the business can be deducted from the income, reducing the taxable profit. Bookkeeping is a requirement, and while detailed accounting is not always mandatory for very small businesses, maintaining accurate records is essential for tax purposes.

The benefits of operating as a toiminimi include ease of setup and minimal administrative burden compared to more complex business structures like limited liability companies (osakeyhtiö). However, the unlimited personal liability is a significant risk. If the business incurs debts that it cannot pay, the owner's personal assets can be used to cover them. This form is often chosen by freelancers, consultants, and small service providers who are just beginning their entrepreneurial journey.