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VAT e-Commerce - One Stop Shop

Exemptions

E-learning activities:

In Finland, the supply of education is VAT exempt when the education is provided in accordance with the relevant legislation or the education is financed by the State. Unless e-learning services are provided as part of VAT exempt education, they are in principle taxable in Finland.

Reference to the above can be found in Articles 39 and 40 of the Finnish VAT Act.

Gambling activities:

In Finland, the organizing and dealing with lottery activities, which are further defined in the Finnish Lottery Act and Lottery Tax Act, is VAT exempt. VAT exempt activities include e.g. casino games, sports betting and similar gambling activities. Lottery activities are strictly regulated and organizing of lottery activities in Finland requires a permit.

Reference to the above may be found in Article 59 2k of the Finnish VAT Act.

General:

There are no further exemptions in the Finnish VAT legislation under which the supply of telecommunications, broadcasting and electronic services provided to non-VAT taxable persons may apply and should be considered.

Invoicing

Invoicing:

No

Invoicing comment:

In Finland, there is no obligation arising from VAT legislation to issue a VAT invoice for telecommunications, broadcasting and electronic services provided to private individuals. An invoice has to be issued for services supplied to non-taxable legal persons. In case a VAT invoice is issued, it should be issued in accordance with Directive 2006/112/EC. All languages are accepted, a translation in Finnish or Swedish may be requested in case of an audit from the VAT authorities. Reference to the above can be found in Articles 209 e and f. of the Finnish VAT Act. Batches of electronic invoices are accepted in Finland.

Payments and reimbursements

As a Member State of consumption, do you require an additional claim before making a reimbursement?:

No

Reimbursement threshold as Member State of consumption:

If the reimbursement is below € 5, it will not be paid to the NETP.

Release from payment of insignificant amounts of VAT:

Finland has not implemented rules under its domestic legislation whereby taxable persons are released from the payment of the VAT where the amount due is insignificant.

Penalties for non compliance

Failure to register and late registration:

The possible penalty for failure to register is a fine.

Reference to the above may be found in Article 134 r of the VAT Act and in Article 37 of the Act on Tax Assessment Procedure of Self-assessed Taxes.

In principle the failure to register or late registration under the MOSS may result in the taxpayer having to register under the standard procedure.

Incomplete and incorrect VAT returns:

A taxable person is allowed to provide a corrective VAT return within three years from the due date or if Finland is the Member State of consumption, three years from the beginning of the year following the accounting period.

If Finland is the Member State of consumption, a punitive tax increase may be charged for filing incomplete or incorrect VAT returns.

Reference to the above may be found in Article 134r of the VAT Act and in Article 37 of the Act on Tax Assessment Procedure of Self-assessed Taxes. As a result of repeated defaults the taxable person may be removed from the MOSS register.

Non-compliance with invoicing and accounting obligations:

Failure to comply with VAT compliance obligations are subject to discretionary penalties. This can also lead to a tax audit that may result in tax increase and penalties.

Reference to the above can be found in para 182 of the VAT Act and para 2 of the "Laki veronlisäyksestä ja viivekorosta" (special act for tax increases and penalty interests 1556/1995).

Non-payment and late payment of VAT:

In the case of non-payment or late payment, a late-payment interest has to be paid upon the taxpayer's own initiative or when imposed by the Tax Administration.

Reference to the above may be found in Article 134 m of the VAT Act.

In some circumstances, taxable persons may ask for a payment arrangement.

As a result of repeated defaults the taxable person may be removed from the MOSS register. Reference may be found in Article 133g in the Finnish VAT Act.

Non-submission and late submission of VAT returns:

If Finland is the Member State of identification, a reminder will be issued. As a result of repeated defaults the taxable person may be removed from the MOSS register. Reference may be found in Article 133g and 133n in the Finnish VAT Act.

If Finland is the Member State of consumption, a punitive tax increase or a penalty charge may be imposed for non-submission or late submission of VAT returns.

Reference to the above may be found in Article 134 r of the VAT Act and in Articles 35 and 37 of the Act on Tax Assessment Procedure of Self-assessed Taxes.

Registration process

VAT Registration Process:

Registration under the MOSS may be made electronically via the Finnish Tax Administration's websites:

https://www.vero.fi/en/e-file/vat-special-scheme-e-service

In order to apply for the registration the taxable person should have a Finnish Katso ID number, further information on Katso identification:

http://www.vero.fi/en-US/Precise_information/eFiling/Katso_Identification

Time of supply – chargeability

Deferment and Cash Accounting Scheme:

In Finland, telecommunications, broadcasting and electronic services provided to non-VAT taxable persons become generally chargeable when the service is delivered. However, VAT becomes chargeable, when a payment is made on account before the service is supplied. Over an accounting period, a taxable person may choose that VAT becomes chargeable when the invoice is issued.

Reference to the above may be found in Articles 136-137 (periodisation) and Article 15 (the time at which the liability to pay VAT arises) of the Finnish VAT Act (1501/1993).

Continuous supplies:

In Finland, continuous supplies of services are regarded as being completed on expiry of the periods to which statements of account or payments relate. However, VAT becomes chargeable, when a payment is made on account before the service is supplied. Over an accounting period a taxable person may choose that VAT becomes chargeable when the invoice is issued.

Reference to the above may be found in Article 15 of the Finnish VAT Act.

Other rules

Additional obligations deemed necessary for collecting VAT and preventing evasion (anti-avoidance measures):

Finland has not implemented any rules or anti-avoidance measures that may directly impact telecommunications, broadcasting and electronic services provided to non-VAT taxable persons.

Bad Debt relief:

Bad debt relief is available in Finland; the necessary adjustments can be made in accordance with Generally Accepted Accounting Principles, i.e. when it has become evident that the payment will most likely not be received.

Reference to the above may be found in Article 78 of the Finnish VAT Act.

Re-valuation of services at open market value:

In Finland, the taxable amount for telecommunications, broadcasting and electronic services provided to non-VAT taxable persons may be deemed to be the open market value, if there is a relationship with common interest between the seller and the purchaser and the consideration agreed is lower than the open market value.

According to the Finnish VAT Law, a relationship with common interest exists between family members and relatives between a company and its owners, employees or persons in a supervision or managerial role in that company, or the family members or relatives of the aforesaid. A relationship with common interest can also exist if there is some other close connection between the seller and the purchaser.

Reference to the above may be found in Article 73 c-e. of the Finnish VAT Act.

Use and Enjoyment:

In Finland, there are no use and enjoyment rules applicable to telecommunications, broadcasting and electronic services provided to non-VAT taxable persons in accordance with Article 59a of Directive 2006/112/EC.

VAT Treatment of vouchers:

According to VAT Act 18 c §, a voucher means an instrument where there is an obligation to accept it as consideration or part consideration for a supply of goods or services and where the goods or services to be supplied or the identities of their potential suppliers are either indicated on the instrument itself or in related documentation, including the terms and conditions of use of such instrument.

A single-purpose voucher means a voucher where the place of supply of the goods or services to which the voucher relates, and the VAT due on those goods or services, are known at the time of issue of the voucher. Each transfer of a single-purpose voucher made by a taxable person acting in his own name shall be regarded for VAT purposes as a supply of the goods or services to which the voucher relates.

A multi-purpose voucher means a voucher other than a single-purpose voucher (e.g. a voucher that can be redeemed against goods and services with different VAT rates). VAT is not chargeable on the issue of a multi-purpose voucher. Instead, VAT will arise when a multi-purpose voucher is redeemed.