Estonian OÜ in Finland: registration, VAT, permanent establishment and employees (2026)

Business ID and registration in Finland

A foreign company gets a Finnish Business ID (Y-tunnus) by filing a start-up notification: form Y1 with appendix form 6204 for a company. You also need an extract from your home country’s trade register, translated into Finnish, Swedish or English. Registration in the Tax Administration’s registers takes about 3 weeks, so file well before work starts.

Joining the prepayment register (ennakkoperintärekisteri) is not mandatory, but it matters in practice: if the company is not registered, the Finnish payer withholds tax from payments for work. Registration alone does not make the company liable to income tax in Finland.

When do you need a branch?

A branch (sivuliike) is the part of a foreign company that professionally carries on business in Finland from Finland, in the company’s name and for its account. A branch must be notified to the Trade Register before it starts operating. An Estonian company needs no permit, because it is established in an EEA country. An EEA company that provides services in Finland only temporarily does not need to notify the Trade Register. The exemption covers only services within the Finnish Services Act — not, for example, transport services or the hiring-out of workers.

• The branch name must contain the foreign company’s name, e.g. "Esimerkki OÜ, Suomen sivuliike".
• The branch must have a representative resident in the European Economic Area.
• The branch notification costs €400 at the Finnish Patent and Registration Office (PRH), and PRH needs foreign documents translated into Finnish or Swedish.
• The foreign company’s financial statements must be filed with the Trade Register within six months of the end of the financial year.

VAT: reverse charge or your own Finnish VAT registration

If the Estonian company has no fixed establishment in Finland and sells services or goods to a Finnish business or organisation, the buyer pays the VAT — even if the buyer itself is not VAT-registered (reverse charge, section 9 of the Finnish VAT Act). The invoice says "käännetty verovelvollisuus" (reverse charge) and shows no VAT amount or rate. The same applies to construction services sold to a Finnish company.

Note that for VAT the fixed-establishment threshold differs from income tax: a building or installation site is a fixed establishment if the contracts last more than nine months — and then from the start of the work. In that case the buyer-liability rule above no longer applies and the company registers in Finland. For construction services the buyer then pays the VAT only if it also sells construction services more than occasionally.

The company must register for VAT in Finland if it has a fixed establishment there or if reverse charge cannot be applied. The typical case is selling to consumers: if an Estonian OÜ paints a private person’s flat in Finland, it must register for VAT in Finland and charge Finnish VAT. The standard rate is 25.5%.

The Finnish €20,000 small-business VAT threshold does not apply to an Estonian company automatically. It is available only through the EU SME scheme: the company’s total EU turnover may not exceed €100,000 in either the current or the previous year, its Finnish sales may not exceed €20,000, and it registers first in Estonia and notifies Finland as a country where it makes exempt sales. An Estonian company does not need a VAT representative in Finland.

Permanent establishment and income tax

Under the Finland–Estonia tax treaty, a permanent establishment is a fixed place of business through which the company operates, such as an office or a workshop. A building, assembly or installation site is a permanent establishment only if the work lasts more than six months. Temporary breaks usually count towards the time, and contracts that form a commercial and geographical whole can be added together.

• Profit of the permanent establishment is taxed in Finland at the corporate rate of 20%.
• The foreign company files the tax return 6U electronically within four months of the end of the month in which the financial year ended.
• If, in the company’s own view, no permanent establishment arises, it states this on the 6U return and attaches form 80 (report on activities). A company doing construction, installation or assembly work in Finland files this report on its activities and contracts every year.
• The Tax Administration decides whether a permanent establishment exists only when it assesses the first year. Until then, assess the situation yourself.

Employees in Finland: A1, notifications and tax

When an Estonian OÜ temporarily posts an employee to Finland, the Estonian Social Insurance Board (Sotsiaalkindlustusamet) issues an A1 certificate for up to 2 years. A1 shows that the employee stays covered by Estonian social security, and contributions are paid to Estonia. A1 is applied for each posted employee. The employer must normally operate in Estonia, and the employee must not be sent to replace another worker; a company that in practice works only in Finland cannot rely on A1. If the employee is not insured in Estonia, the employer must take out a Finnish TyEL pension insurance for them, which costs about 20% of the salary, and accident, unemployment and group life insurance may also be required.

• The posting of workers is notified to the Finnish occupational safety authority before work in Finland begins. In construction, the notification is always required.
• The company must have a representative in Finland — in practice an address in Finland. None is needed if the posting lasts no more than ten days; postings during the previous four months are counted in.
• On a construction site everyone must have a tax number (veronumero) on a photo ID card, entered in the public register before work starts.
• Construction reports: the buyer of construction work reports contracts over €15,000 excluding VAT to the Tax Administration by the 5th day of the second month after the reporting month. The OÜ reports itself if it buys subcontracting, and passes its worker data to the principal contractor (päätoteuttaja).
• Occupational health care must be arranged in Finland for posted workers. The Finnish client asks for documents under the Contractor’s Obligations Act (tilaajavastuulaki), for posted workers e.g. A1 certificates.

Tax on wages depends on the 183-day rule. Finland does not tax the wages only if all three conditions are met: the employee stays in Finland no more than 183 days in any 12-month period, the wages are paid by an employer not resident in Finland, and the wages are not borne by the employer’s permanent establishment in Finland. If the OÜ has a permanent establishment, wages for work through it are taxable in Finland from day one, and the company is treated like a Finnish employer: it withholds tax from wages. On a construction site this becomes certain only after six months, but it applies from the start. Without a permanent establishment, wages are reported to the Incomes Register if the employee is insured in Finland, stays here more than 6 months, or is a hired-out worker whose wages Finland may tax. The deadline is 5 days from the payment date.

What about Estonian tax?

In Estonia, the company pays income tax only when it distributes profit. In 2025–2026, the rate on distributed profit is 22/78. Profit of a Finnish permanent establishment and Estonian tax must be reconciled under the tax treaty, so keep the Finnish activity separate in the books from the very start.

Help for your Estonian company in Finland

We help you work out which Finnish obligations your company has, and we handle registrations, VAT returns, Incomes Register reports and the Finnish bookkeeping. Our accountants serve you in Finnish or Russian.

Official sources

• Vero: foreign business in Finland
• Vero: VAT of a foreign company in Finland (in Finnish)
• Vero: VAT exemption for small-scale business (in Finnish)
• Vero: income tax of a foreign company in Finland (in Finnish)
• Vero: employer obligations of a foreign company (in Finnish)
• PRH: branch registration (in Finnish)
• Finlex: Finland–Estonia tax treaty (SopS 96/1993)
• Finlex: Value Added Tax Act 1501/1993 (in Finnish)
• Työsuojelu: notification of posted workers (in Finnish)
• Finnish Centre for Pensions: working in Finland (in Finnish)
• EMTA: Estonian tax rates