Transfer pricing in Finland at a glance
|Are there specific transfer pricing regulations?||Yes|
|Submission deadline||No earlier than 6 months after the end of the financial period|
|Submission deadline upon request||60 days|
|Annual update required||No|
|Official language requirements||Finnish, Swedish and English|
|Potential impact of penalties||Up to 25K|
Finnish tax law
Rules for transfer pricing in Finland are based upon:
- Finnish Tax Act on Assessment Procedure §14 a-c, 31, 32, 75 and 89
- Government Proposal and Tax Administration’s Guidelines of 19 October 2007
Rules for transfer pricing in Finland follow the OECD Transfer Pricing Guidelines.
Accepted methods are:
- the comparable uncontrolled price method;
- the resale price method;
- the cost plus method;
- the profit split method, and
- the transactional net margin method.
Priority of methods
Rules for transfer pricing in Finland do not prescribe a priority of method.
Information that should be included in the documentation:
- A description of the business;
- A description of associated enterprises;
- Information on transactions between associated enterprises;
- Functional analysis regarding transactions between associated enterprises;
- A comparability analysis, including available information on comparables, and
- A description of the transfer pricing method and its application.
Rules for transfer pricing in Finland prescribe that documentation should be submitted in either one of the following languages:
Requirements to prepare documentation annually
There is no formal requirement to prepare documentation annually, however, it is recommended.
Submission deadline upon request by tax authorities
Upon request of the tax authorities, a taxpayer should submit its documentation within 60 days after a request has been made.
Advanced Pricing Agreements
Rules for transfer pricing in Finland do no provide for specific Advanced Pricing Agreement procedures.
Rules for transfer pricing in Finland provide for a penalty of EUR 25,000 if a taxpayer fails to comply with the transfer pricing documentation requirements.