Tax Finland 

Purpose

This component describes the handling of the employee tax under Payroll Finland.

In Finland, the National Board of Taxes computes annual basic taxes payable by an employee. The tax authorities send this information to the employee as a Tax Card.

You compute employee tax based on the information specified in the Tax Card.

Features

·       Tax Card Information Finland infotype (0205)

Using this infotype, you can store the employee’s tax card information. For example, the type of Tax Card, the tax rates and the annual tax limits.

·       Tax Card type

The tax calculations depend on the Tax Card type of the employee. A Tax Card may be a:

¡      Primary Tax Card

This tax card typically has two rates, a Basic Rate and an Additional Rate. The tax is for persons with a salaried income.

¡      Progressive Tax Card

A progressive tax card has no Additional Tax Rate. Instead, it has several tax rates that are applicable until the limit mentioned in the tax card. For example, Ancillary Tax Card (for ancillary income), Student Tax Card and the Tax Card for employees working abroad.

·       Tax withholding rates

The withholding rate specified on the Tax Card depends on the estimation by the tax authorities on total sum of state tax, municipal tax, church tax and social security contributions that a salaried person, wage earner or other income receiver is required to pay for a selected tax year.

·       Tax calculation methods

Based on the Tax Card, the following tax computation methods are available:

¡      Primary Tax Card

§       Periodic Tax Calculations

§       Cumulative Tax Calculations

¡      Ancillary Tax Card

Staircase Tax calculations

·       Tax Reports

The following tax related reports are available under Payroll Finland:

¡      Data Collector for annual tax statement report (HFILTAX0)

¡      Finnish ATS Data Presentation report (HFILTAX1)

¡      Display Tax Card Information (Finland) report (HFILCTRE)

¡      Download Tax Card (Finland) report (HFIUTCDL)

¡      Upload tax card (Finland) report (HFIUTCUL)

¡      Tax and social insurance statement Finland report (HFICTAX0)

·       Tax configurations

You can configure the employee tax related information in the IMG under:

¡      Payroll Finland ® Taxes

¡      Payroll Finland ®Reporting ® Annual Tax Statement