Finland’s Ministry of Finance has proposed amendments to the Tax Procedure Act to expand mandatory electronic reporting, simplify withholding procedures and strengthen tax administration and penalties, with most changes planned from 1 January 2028.
Finland’s Ministry of Finance has submitted a draft proposal for public consultation, seeking amendments to the Tax Procedure Act and related legislation on 21 August 2026.
The changes target three main areas: digitalisation of tax reporting, simplification of administrative processes, and strengthened enforcement mechanisms.
The amendments are scheduled to take effect on 1 January 2028, with the exception of one provision affecting third-party informants, which becomes effective on 1 January 2029.
The deadline for submitting comments is 2 October 2026.
Mandatory electronic reporting expands
The Tax Administration plans to require all parties subject to reporting obligations, including individual taxpayers, to file electronically. Currently, the electronic reporting priority applies selectively. The expansion aims to create a more uniform reporting framework across the tax system. Payers of pensions and benefits will face a new requirement to notify the Tax Administration in advance before initiating new pension or benefit payments. This notification requirement is designed to improve data accuracy and reduce discrepancies between reported and actual distributions.
Streamlined withholding tax procedures
Payers will be permitted to apply withholding tax deductions when making payments to limited taxpayers without requiring the recipient to present a withholding tax card. Additionally, the Tax Administration will retrieve withholding tax information directly from recipients electronically rather than relying on payers to obtain and verify this data independently. These changes eliminate redundant verification steps and reduce the administrative burden on businesses and individuals alike.
Administrative adjustments and enforcement
The proposed amendments would grant the Tax Administration authority to annul tax assessments based on a taxpayer’s new return, circumventing the existing Taxation Adjustment Board process. The Tax Administration may also decline to pursue adjustments for minor discrepancies in inheritance and gift taxation cases.
Penalties for third-party informants who fail to comply with reporting requirements will increase for instances of serious non-compliance, effective 1 January 2029.
This change aligns domestic penalties with international standards for tax information exchange and strengthens deterrence against non-compliance.
