Tuontivähennys

Tuontivähennys refers to a tax deduction available in Finland that allows companies to reduce their taxable income based on the value of imported goods and services. This mechanism aims to mitigate the impact of value-added tax (VAT) paid on imports that cannot be fully recovered. Essentially, it's a way to level the playing field for businesses that incur VAT on imported inputs but might not have corresponding deductible input VAT.

The primary purpose of the tuontivähennys is to prevent double taxation and ensure that Finnish businesses are not at a disadvantage compared to domestic suppliers. When a company imports goods or services, it typically pays import VAT. If this import VAT cannot be fully deducted as input VAT, the remaining non-deductible portion can be claimed as a tuontivähennys. This reduces the company's overall tax liability.

Eligibility for tuontivähennys is subject to specific conditions outlined in Finnish tax legislation. Generally, the deduction is applicable to VAT paid on goods and services that are directly used in the company's taxable business activities. However, there are limitations and exclusions, and the exact rules can be complex. Companies must maintain proper documentation to substantiate their claims for tuontivähennys. Consulting with tax professionals is often recommended to ensure correct application of these rules.