arvonlisäverottoman

Arvonlisäverottoman is a Finnish term that translates to "without value-added tax" or "VAT-exempt." It refers to goods or services that are not subject to Finland's value-added tax (VAT). This exemption means that when a VAT-exempt item or service is sold, the seller does not charge VAT to the buyer, and the seller cannot reclaim any VAT they may have paid on their own business expenses related to that item or service.

The VAT exemption is typically applied to specific categories of goods and services deemed socially or economically important. Common examples include certain healthcare services, educational services provided by recognized institutions, financial services, and certain insurance products. The specific criteria for exemption are defined in Finnish VAT legislation, which aligns with EU VAT directives.

Businesses that exclusively provide VAT-exempt goods or services are generally not required to register for VAT and cannot claim input VAT deductions. However, if a business provides both VATable and VAT-exempt supplies, it must carefully separate its transactions and adhere to specific accounting rules to determine the extent to which it can reclaim VAT on its expenses. The term "arvonlisäveroton" is crucial for businesses operating in Finland to understand their tax obligations and pricing strategies.