Finland – Property Taxes

What taxes and fees apply when buying a property in Finland?

The primary transaction tax imposed on property purchasers in Finland is the transfer tax (varainsiirtovero). The transfer tax on direct real estate was reduced from 4% to 3%, and the rate on apartment purchases made via housing company shares fell from 2% to 1.5%. Both revised rates took effect on 1 January 2024, and were applied retroactively to transactions completed on or after 12 October 2023. Always confirm the prevailing rate with the Finnish Tax Administration (Vero.fi).

Understanding the difference between purchasing real estate directly and acquiring shares in a Finnish housing company (asunto-osakeyhtiö) is essential. The majority of Finnish apartments are held through housing company shares rather than as freehold property, and the lower 1.5% transfer tax applies to those share acquisitions. Purchasing a detached house together with its plot generally attracts the 3% rate on the real estate itself. In all cases, the transfer tax liability falls on the purchaser.

In contrast to countries such as France — where mandatory notary fees can add 7–8% to the transaction cost — Finland does not require notarial involvement in routine property deals. No stamp duty is charged in Finland. Buyers are, however, liable for registration fees payable to the National Land Survey of Finland (Maanmittauslaitos) for recording changes of ownership. Current fee schedules are published at Maanmittauslaitos.fi and are updated from time to time.

For newly constructed properties acquired directly from a developer, VAT may be applicable to the construction portion of the price. Finland’s standard VAT rate stands at 25.5%. In practice, VAT on new-build transactions is typically incorporated into the agreed sale price — buyers should always confirm with the developer whether the stated price is VAT-inclusive. Crucially, transfer tax and VAT do not apply simultaneously to the same transaction, so purchasers of brand-new properties from a VAT-registered developer are generally not required to pay transfer tax on top of the VAT-inclusive purchase price.

Worked example — purchasing a resale apartment (housing company shares):
Purchase price: €250,000
Transfer tax at 1.5%: €3,750
Payable by: the buyer, within two months of signing the sale deed.

Worked example — purchasing a house and plot (real estate):
Purchase price: €350,000
Transfer tax at 3%: €10,500
Payable by: the buyer, before applying to register the title deed with the Land Survey.

First-time home buyers previously benefited from a transfer tax exemption, but this was abolished with effect from 1 January 2024. Anyone who had been planning their first purchase with that exemption in mind should take note of this significant change. No differential transfer tax rate applies based on whether the buyer is a Finnish resident or a foreign national.

What taxes and fees apply when selling a property in Finland?

Sellers in Finland are not subject to any equivalent “seller’s transfer tax” — that obligation rests entirely with the buyer. The principal financial considerations for a seller relate to estate agent fees, any legal advisory costs, and capital gains tax on the profit arising from the disposal (discussed in the following section). There is no municipal levy or specific sales tax charged to the seller at the point of transfer, unlike the position in certain other jurisdictions.

Estate agent commissions in Finland are negotiable and typically fall in the range of 2% to 4% of the sale price, depending on the agency involved, the nature of the property, and its location. These fees are borne by the seller and may generally be offset against the taxable gain when computing capital gains tax liability. It is advisable to obtain a written agency agreement that clearly sets out the commission arrangement before marketing your property.

Legal costs for sellers are typically modest in Finland — engaging a solicitor or legal adviser to review sale contracts is an option but not a statutory requirement. There is no transfer tax obligation for the seller where a transfer arises through inheritance, a gift, or a division of assets subject to matrimonial property rights. In straightforward open-market sales, capital gains tax is the seller’s primary tax concern, as addressed in detail below.

How does capital gains tax work on property in Finland?

Profits arising from property sales are treated as capital income for Finnish tax purposes. The applicable capital tax rate is 30%; where a taxpayer’s total taxable capital income in the year exceeds €30,000, the excess is taxed at 34%. These rates apply to gains realised by tax-resident individuals on property disposals. Always verify the current rates with the Finnish Tax Administration.

The chargeable gain is determined by deducting allowable costs from the sale proceeds. Expenses that may be deducted include the original acquisition price, transfer tax paid on purchase, estate agent commissions, legal fees, and expenditure on capital improvements made to the property. As an alternative, the seller may use a deemed acquisition cost of either 20% or 40% of the selling price in lieu of actual documented costs. The 20% figure applies where the property has been held for fewer than ten years; the 40% rate applies where it has been held for ten years or more. The seller is free to select whichever method — actual costs or deemed acquisition cost — produces the smaller taxable gain. This mechanism broadly resembles indexation relief available in certain other European countries, though it operates as a fixed percentage rather than an inflation-adjusted figure.

Worked example — disposing of a property held for under 10 years:
Sale price: €300,000
Actual purchase price and associated costs: €210,000
Actual gain: €90,000
Deemed acquisition cost alternative (20% of €300,000): €60,000, implying a deemed gain of €240,000 — the actual cost method is clearly more favourable here.
Tax: 30% on first €30,000 = €9,000; 34% on remaining €60,000 = €20,400. Total CGT: €29,400.

Primary residence exemption: A gain on the sale of a home is fully exempt from capital gains tax provided the property has served as the individual’s or their family’s permanent residence for an uninterrupted period of at least two years during the seller’s period of ownership. This is among the most valuable reliefs available within the Finnish system and is broadly analogous to the principal private residence relief found in many other countries. Notably, there is no requirement to reinvest the proceeds in another property in order to claim the exemption.

Capital losses on property disposals may be deducted first against capital gains in the same year; where no capital gains exist, the loss may secondarily be set against other capital income. Any unused loss may be carried forward for up to five subsequent tax years.

Non-residents remain liable to Finnish capital gains tax on the transfer of Finnish real estate, on the transfer of shares in Finnish housing limited companies, and on the transfer of shares in other limited companies whose assets consist predominantly (more than 50%) of Finnish real estate. Residence abroad therefore provides no shield against Finnish CGT exposure on Finnish property. However, the terms of any double taxation treaty between Finland and the seller’s country of residence may restrict Finland’s taxing rights in a given situation, making it essential to examine whether a relevant treaty applies. Finland currently has approximately 78 double taxation treaties in force.

Are there any ongoing annual property taxes in Finland?

Finland imposes an annual real estate tax (kiinteistövero) on all property owners. The tax is levied on real estate situated in Finland and falls on whoever owns the taxable property at the start of the calendar year in question. The most notable exemptions from this tax relate to forested land and agricultural land.

Annual property tax rates are determined by individual municipalities within ranges set at the national level. The tax base is the assessed taxable value of the property rather than its purchase price or current market valuation, and different rates apply depending on whether the property is used as a permanent home, a commercial or industrial facility, a holiday property, or undeveloped land. This structure is broadly comparable to council tax or municipal rates in other countries, though it differs from the UK’s council tax — which is banded by estimated market value and collected from occupiers — in that Finland’s system is assessed on a taxable value and charged to the owner regardless of occupancy.

Residential buildings used as permanent homes attract the lowest rates, ranging from 0.41% to 1.00% of assessed value (as of 2025). This preferential rate reflects Finnish policy aimed at supporting homeownership and housing affordability for residents.

Commercial properties, industrial premises, and leisure or holiday homes are subject to considerably higher rates. Commercial and industrial property rates typically fall between 1.30% and 2.00% of assessed value, while holiday homes face rates of between 0.93% and 2.00%.

Municipalities may additionally impose a separate real estate tax on vacant plots situated within a town plan area that are neither in residential use nor under active construction. This supplementary rate on undeveloped land may range from 2% to 6% and is intended to incentivise development rather than land banking.

Property tax calculations in Finland are grounded in assessed taxable values rather than in market prices or transaction figures. The taxable value is derived from two components: the replacement value of any buildings on the land, and the market or area value of the land itself. The Finnish Tax Administration periodically reassesses these taxable values. Annual tax bills are issued by the relevant municipality and are generally collected in one or two instalments. Finland levies no wealth tax of any kind.

How does inheritance tax apply to property in Finland?

Tax is imposed on property received by inheritance, will, or gift. Inheritance tax applies to a person who acquires immovable or movable property through inheritance or a will, where the deceased, the inheritor, or the beneficiary was resident in Finland at the time of the death. Immovable property located in Finland, and shares in companies whose assets consist mainly of Finnish immovable property, are invariably subject to Finnish inheritance taxation regardless of where the parties are resident.

Finnish inheritance tax is levied on each beneficiary’s individual share of an estate, rather than on the estate as a whole before distribution. This contrasts with an estate tax model such as that used in the United States, where the estate itself bears the tax liability prior to any distribution to heirs. In Finland, each heir is taxed only on what they personally receive.

Beneficiaries are placed into one of two tax classes. Class I encompasses spouses, children, a spouse’s children, adopted children, parents, adoptive parents, and direct descendants of children or adopted children, together with engaged partners in certain circumstances and cohabiting partners where the couple previously married or have a child together. Class II covers all other relatives and unrelated individuals. Rates on larger inheritances range from 7% to 19% for Class I beneficiaries and from 19% to 33% for Class II beneficiaries. Always consult the Finnish Tax Administration for the current rate schedule.

The Finnish Parliament has enacted legislation increasing the inheritance and gift tax thresholds with effect from 2026. Inheritances of less than €30,000 and gifts of less than €7,500 will no longer attract tax from that date. Prior to 2026, the threshold stood at €20,000. Given that this is an area of ongoing legislative development, always verify the current threshold with the Finnish Tax Administration.

The position of non-residents deserves particular attention from expats. Where real property or buildings in Finland are part of an inheritance, Finnish inheritance tax will be due regardless of whether both the deceased and the beneficiary resided outside Finland at the relevant time. If you live abroad and inherit Finnish immovable property, your Finnish inheritance tax liability exists even if the person who left you the property also spent their life outside Finland.

Finland has concluded inheritance tax treaties with Denmark, Iceland, France, the Netherlands, Switzerland, and the United States of America. The provisions of any applicable treaty may create exceptions to the standard inheritance tax rules. If your country of residence is not among those listed, there is a risk of double taxation on the same inherited assets — making professional advice particularly important. Full guidance is available from the Finnish Tax Administration and the Ministry of Finance.

How does gift tax apply to property transfers in Finland?

Gift tax is charged on a person who receives immovable or movable property as a gift where either the donor or the recipient is resident in Finland at the time of the donation. Immovable property situated in Finland, and shares in companies whose assets are composed mainly of Finnish immovable property, are always subject to Finnish gift taxation irrespective of the parties’ places of residence.

The taxable value of gifts is calculated on a cumulative basis within rolling three-year periods. This means that multiple gifts received from the same donor within any three-year window are aggregated for tax assessment — an approach designed to prevent large transfers from being fragmented into smaller tax-free amounts. From 2026, gifts below €7,500 will fall outside the scope of gift tax. The earlier threshold was set at a lower figure. Confirm the current amount with the Ministry of Finance.

Gift tax rates closely follow those applicable to inheritance tax, with Class I (immediate family) rates lower than those in Class II (all others). Where property is transferred by way of gift — as opposed to a sale — no transfer tax arises, since transfer tax exemptions cover acquisitions through inheritance, gift, or a matrimonial property settlement. However, gift tax must still be considered in any such arrangement.

No gift tax applies to household effects received as gifts for the recipient’s personal use where the total value is below €5,000, nor to gifts received solely for the beneficiary’s education or personal maintenance. These carve-outs relate to personal items and consumable benefits — they will not ordinarily apply to the transfer of real estate.

Where property is gifted and the recipient subsequently sells it, the taxable gain for capital gains tax purposes is computed using the taxable value applied in the gift tax assessment as the acquisition cost — not the price originally paid by the donor. This can materially affect future CGT exposure and should be carefully weighed in any estate planning strategy involving property. Non-resident donors or recipients should seek specialist advice, as the interaction between Finnish gift tax and the tax regime of the other country involved can give rise to complex outcomes.

How is rental income from property taxed in Finland?

Rental income is taxable in Finland and must be declared by taxpayers in their annual tax returns. For Finnish tax residents, rental income is classified as capital income and taxed at the same progressive rates that govern capital gains: 30% on amounts up to €30,000, and 34% on any excess above €30,000 (as of 2025). Always check the prevailing rates with the Finnish Tax Administration.

Non-resident landlords are generally taxed at a flat withholding rate on Finnish-source rental income. The exact rate and the associated filing requirements may be modified by a double taxation treaty between Finland and the landlord’s country of residence. Non-residents contemplating letting Finnish property should seek specific guidance from the Finnish Tax Administration or a qualified Finnish tax adviser before doing so.

Finland permits a wide range of expenses to be offset against rental income. Mortgage interest on loans taken to acquire an investment property held for letting is fully deductible. Other deductible costs typically include maintenance and repair expenditure, management and agency fees, property insurance premiums, and communal housing charges (hoitovastike) payable to the housing company. Renovation costs incurred in relation to a rented property may also be deducted from rental income.

Worked example — rental income for a resident taxpayer:
Annual rent received: €12,000
Less: mortgage interest on rental property: €2,400
Less: maintenance costs and management fees: €1,200
Net taxable rental income: €8,400
Tax at 30%: €2,520

Income from short-term holiday lettings — for example through platforms such as Airbnb — is taxed in Finland on the same basis as income from long-term tenancies. The Finnish Tax Administration obtains data on income generated through digital platforms, both domestically and from abroad, and supervises the declaration of such income for assessment purposes. Taxpayers are required to report this category of income on their pre-completed tax return in all cases. There is no dedicated licensing framework specifically governing short-term holiday rentals in Finland at a national level, although local municipal rules or the regulations of a particular housing company may impose their own restrictions.

Are there any tax advantages or incentives for buying property in Finland?

The most substantial property tax benefit available in Finland is the capital gains exemption for a primary residence. Where a taxpayer has owned and lived in a property as their permanent home for an unbroken period of at least two years, any gain on the eventual sale is exempt from capital gains tax entirely. This exemption applies on equal terms to residents and, in principle, to anyone who has genuinely occupied the property as their main home — though non-residents will encounter practical obstacles in demonstrating that the property qualifies.

From 2023 onwards, mortgage interest on loans used to purchase an owner-occupied home and interest on loans taken out for major repairs to a primary residence are no longer deductible. This marks a significant departure from the previous regime. Nonetheless, mortgage interest on loans used to acquire a property held as a rental investment continues to be fully deductible. Landlords should therefore keep detailed records of their financing costs from the outset.

Finland also operates a household expense tax credit (kotitalousvähennys), which provides a tax credit for specified work carried out on a home. Payments made to tradespeople for renovation and repair work are eligible for deduction as household expenses. The credit may also be claimed in connection with work performed at a primary home or holiday property, encompassing services such as cleaning, childcare, or technology installation. This is a practical and useful benefit for property owners undertaking maintenance or improvement projects — the current credit ceiling should be verified with the Finnish Tax Administration, as it is reviewed on an annual basis.

The first-time buyer transfer tax exemption that existed under the old regime was removed from 1 January 2024, though this coincided with a general reduction in transfer tax rates for all buyers. Finland does not operate any property-linked investment visa or golden visa scheme. As an EU member state, Finland extends equal property rights to EU and EEA citizens as to Finnish nationals.

For purchasers of investment properties, depreciation allowances on buildings may be claimed against rental income over time — the applicable rates vary according to building type and should be confirmed with a local tax adviser or through the resources available at Vero.fi.

What are the tax implications for foreign nationals buying property in Finland?

Finland does not impose any additional transfer tax surcharge or special restriction targeting foreign purchasers of residential property. All property owners in Finland are subject to property taxes regardless of their nationality or where they reside. The transfer tax rates of 3% on real estate and 1.5% on housing company shares apply uniformly to every buyer. Unlike countries such as Canada and New Zealand, which have in recent years introduced foreign buyer levies or ownership restrictions, Finland maintains an open and accessible property market for international purchasers.

The Finnish tax system draws a fundamental distinction between tax-resident and non-resident individuals, each group being subject to different rules. Persons who are tax-resident in Finland are taxed on their worldwide income, meaning all income regardless of its source must be reported and taxed in Finland. Non-residents, by contrast, are taxed only on income that arises from Finnish sources.

For non-residents, the Finnish-source income streams relevant to property ownership include: rental income generated by a Finnish property; capital gains on the sale of Finnish real estate or housing company shares; and any receipt of Finnish property through inheritance or gift. Non-residents remain subject to Finnish capital gains tax on disposals of Finnish real estate and on transfers of shares in Finnish housing limited companies or other companies whose assets consist predominantly of Finnish real estate.

Finland has approximately 78 double taxation treaties currently in force. The Nordic Tax Convention provides particular provisions among the Nordic states. Finnish treaties are generally modelled on the OECD template. A treaty can determine which country holds primary taxing rights and specify how Finnish tax paid is credited in the taxpayer’s country of residence — but the precise outcome depends heavily on the treaty involved, and professional interpretation is often necessary.

Foreign purchasers should equally consider any reporting obligations they face in their home country. Many countries require residents to declare ownership of overseas property and to report all income or gains derived from it. The Finnish Tax Administration may itself request relevant information, and it obtains data on income generated through digital platforms from both Finnish and foreign sources. Maintaining thorough documentation of the purchase price, all acquisition costs, and any capital improvements is strongly recommended from the moment of purchase.

Before proceeding with any Finnish property transaction, always consult a tax professional with expertise in Finnish tax law and the rules of your own country of residence. For official information, refer to the Finnish Tax Administration (Vero.fi).

Frequently Asked Questions

Do I pay capital gains tax if I sell my Finland property as a non-resident?

Non-residents remain liable to Finnish capital gains tax on transfers of Finnish real estate and on transfers of shares in Finnish housing limited companies or other companies whose assets consist predominantly of Finnish real estate. Being based abroad offers no exemption from this liability. A double taxation treaty between Finland and your country of residence may affect how the tax burden is ultimately allocated — consult both the Finnish Tax Administration and a qualified local adviser for guidance specific to your situation.

Can I deduct mortgage interest on rental income in Finland?

Mortgage interest on loans taken out to acquire an investment property held for letting is fully deductible against rental income. This deduction is available for properties genuinely held as rental investments. It is important to note, however, that from 2023 onwards, mortgage interest on loans used to purchase an owner-occupied home and interest on loans for major repairs to a primary residence are no longer deductible. Confirm the current rules with the Finnish Tax Administration.

Is there a wealth tax on property in Finland?

Finland levies no wealth tax of any kind. The recurring costs of property ownership are confined to the annual real estate tax charged by municipalities on the assessed value of the property. This stands in contrast to countries such as Spain, which applies a wealth tax (Impuesto sobre el Patrimonio) to high-value assets — no comparable levy on total net wealth exists in Finland.

Is the primary residence exemption available to non-residents?

The capital gains exemption requires that the property was used as a genuine permanent home for an unbroken period of at least two years during the period of ownership. A non-resident who has never actually lived in the Finnish property will not be able to claim the exemption. If you occupied the property as your principal home before relocating abroad, you should seek specific advice from the Finnish Tax Administration on whether and how the exemption may still apply to your circumstances, as the rules involve timing and usage considerations.

What happens to my Finnish property if I die — will my heirs pay inheritance tax?

Finnish inheritance tax is always payable on Finnish real estate or buildings that form part of an inheritance, even if both the deceased and the beneficiary were resident outside Finland throughout their lives. From 2026, inheritances below €30,000 will no longer be taxed. Rates as of 2025 range from 7% to 19% for Class I beneficiaries (close family) and from 19% to 33% for Class II beneficiaries (others) — always verify the current figures with the Finnish Tax Administration.

What transfer tax rate applies when buying an apartment in Finland?

With effect from 1 January 2024, the transfer tax rate is 3% of the purchase price for direct real estate acquisitions and 1.5% for purchases of housing company shares. As most Finnish apartments are acquired through housing company shares, the 1.5% rate is the one that most apartment buyers will encounter. The first-time buyer transfer tax exemption was abolished at the end of 2023 and no longer applies. Always check the rate in force at the time of your transaction with the Finnish Tax Administration.

How is short-term Airbnb rental income taxed in Finland?

Income from short-term holiday lettings is treated identically to income from long-term tenancies for Finnish tax purposes. It is taxed as capital income at 30% (or 34% on the portion of total capital income exceeding €30,000) for resident taxpayers. The Finnish Tax Administration collects data from digital rental platforms, both within Finland and from abroad, supervises the reporting of that data for assessment, and requires taxpayers to declare all such income on their pre-completed tax return without exception. Allowable expenses may be deducted in the same manner as for conventional long-term rentals.

Are there restrictions on foreigners buying property in Finland?

Finland imposes no special restrictions or supplementary taxes on foreign nationals wishing to purchase residential property. The same transfer tax rates apply to every buyer regardless of nationality or residence. As an EU member state, Finland grants EU and EEA citizens full property rights on the same footing as Finnish nationals. Non-EU/EEA buyers should consider any immigration and residency implications that may accompany property ownership, but the acquisition of property itself is not subject to restriction. Always engage a qualified local legal and tax adviser before finalising any purchase.