Abolition of VAT relief

One of the most significant changes is the abolition of the VAT relief. Until now, small businesses with a turnover of less than €30,000 have been able to receive tax relief. From 2025 onwards, this relief will no longer be granted.

Increase in the threshold for small-scale activities

The threshold for small-scale activities, which determines when a business must register for VAT, will increase from €15,000 to €20,000. This means that businesses with an annual turnover of less than €20,000 will not be required to pay VAT.

New EU VAT scheme

A new change will introduce the EU VAT scheme for small businesses. This allows the VAT exemption for small-scale activities to be applied to business conducted in another EU country. To enter the scheme is voluntary, and the business must register for it in its country of establishment.

A business established in Finland can register for the EU VAT scheme from 1 January 2025 by submitting a pre-registration notification in MyTax.

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Guidance for entrepreneurs

1. Monitor turnover carefully: In 2025, the threshold for small-scale activities will increase to €20,000. Before your business turnover exceeds this threshold, you must register for VAT and pay VAT. The obligation to pay VAT also starts from this point. Currently, a business must register and pay VAT retroactively for the entire financial year's sales if the turnover exceeds the threshold for small-scale activities during the financial year.
2. Prepare for the abolition of VAT relief: If you have been benefiting from the VAT relief, note that this tax relief will be abolished from the beginning of 2025. This may affect your company’s taxation and cash flow.
3. Utilise the new EU VAT scheme: If you are doing business with other EU countries, consider registering for the new EU VAT scheme. This can facilitate international trade and reduce administrative burden.
4. Update accounting systems: Ensure that your accounting systems are up to date and capable of handling the new VAT regulations. This helps avoid errors and ensures that all taxes are reported correctly.
5. Train staff: If you have employees, ensure they are aware of all upcoming changes and know how to act accordingly.
6. Consult an expert: If you are unsure how the changes will affect your business, contact your accountant or business advisor. An expert can help you navigate the changes and ensure your business complies with the new rules.

• Read more on the Tax Administration's website
• Find a partner for your business's financial matters among our expert partners
• Book an appointment with business advisor