Michaela Merz

Finland – cash flow friendly declaration of import VAT as from 1 of January 2018

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Starting 1.1.2018 the Finnish Import VAT will need to be paid and reported to the Finnish Tax Administration instead of the Finnish Customs. The Finnish Customs has previously been the competent authority relating to the VAT on the importation of goods, but will no longer handle such matters starting next year (the exception being imports of goods by individuals and companies not being registered for VAT).

How does this affect companies VAT registered in Finland who import goods to Finland?

  • The Import VAT will hereafter be reported at the company’s own initiative to the Tax Administration
  • The Import VAT is reported electronically on the monthly VAT return
  • The Import VAT no longer needs to be paid before it may be deducted. The tax is reported and deducted in the same reporting period, according to the date of the Customs import decision.

How is the Import VAT to be calculated?

  • The company reporting the Import VAT must calculate the tax basis and Import VAT themselves
  • The tax basis for Import VAT includes:
    • the value of the goods
    • other taxes carried by the State and the EU except for VAT
    • customs duties
    • import fees
    • other fees and taxes paid outside of Finland, which are due to the importation of the goods
    • freight costs, costs for loading and unloading of the goods, insurance fees as well as other costs relating to the importation of the goods until the first destination in Finland or until the second destination in Finland, or in another Member State, when the second destination is known at the time of the formation of the VAT liability.

As the Import VAT is in the future wholly reported and paid in connection with the self-assessed tax return (VAT return), the responsibility of calculating the Import VAT is placed on the importer. This procedure demands an understanding of what constitutes the tax basis and requires the importers attention to make sure all the documentation is available for the VAT reporting purposes. In addition, the new procedure might require changes to the processes and systems of the importer.

If you have any questions, please do not hesitate to contact Ilona Paakkala on +41 58 792 42 58 or paakkala.ilona@ch.pwc.com.

 

Bildquelle: Birgit Winter  / pixelio.de

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