Finland: Import VAT reverse charged on periodic VAT returns as of 2018

As of 1 January 2018, businesses registered for VAT in Finland shall apply new rules for handling VAT on imported goods from outside the EU. Since 1 January 2018, the authority in charge of handling import VAT issues for businesses registered for VAT in Finland is no longer Finnish Customs but the Tax Administration. However, the significant change for the companies is that, through the new procedure, VAT on the imports no longer needs to be paid before it may be deducted. Despite the financial benefits, businesses registered for VAT also benefit from a more convenient procedure.

Due to the changes, businesses will report the VAT on imports on their own initiative during the usual self-assessment tax return procedure. The taxpayer shall calculate the tax basis and the amount of the import VAT him/herself and shall report it with all other VAT positions on one single tax return for the period. In order to report and pay the import VAT correctly, attention should be paid to the calculation of the tax basis and sufficient documentation. In general, import VAT is based on the customs value of the goods, customs duties and other costs and fees related to the import of the goods. The customs value is based on a customs decision issued by customs.

Self-assessment tax returns must be filed electronically, for instance, using the Tax Administration’s eService, known as MyTax (view link). When filing returns for each calendar month, the deadline for filing and paying self-assessed taxes is the 12th of the month. The filing of self-assessed tax returns on paper is allowed only in special circumstances. However, no specific permission is required for paper filing.

Businesses that are not registered for VAT in Finland and private individuals are not affected by the new rules.