Annual information return on payments of interest, calling for withholding of tax at source 2022, instructions

This guidance concerns the VSKTVYSL information flow. This annual return can be submitted on a fillable web form or as a software-generated file. However, it cannot be submitted on a paper form.

Introduction

Filers must use this information return format for reporting the interest they have paid out on bank account deposits, on deposits in a personnel service office (also known as 'employees' bank', huoltokonttori in Finnish), on the balances of client accounts in payment institutions (card companies) and on bonds and debentures.

Accordingly, this information return format is for reporting the paid interest on domestic bank deposits received from the public, and for reporting the paid interest on bonds and debentures issued for the public for subscription. Payments of index compensation (indeksihyvitys; indexgottgörelse in Finnish and Swedish) must also be reported. However, you are not expected to submit this information return if you have paid out interest that is tax-exempt under the applicable definitions of law. In the same way, if a transfer of deposits, bonds or debentures has been made and you have paid interest in connection with such transfers, you are not expected to include that kind of interest in this information return. Tax at source is not to be withheld on paid-out interest in circumstances where the beneficiary is a holder of an equity savings account, within the meaning of §53 b of the act on income tax, and the interest has accrued on any deposits linked to the equity savings account.

If you have paid interest to nonresident beneficiaries, you must use another information return format (either the VSRKOERI information flow or Form 7809e on paper).

Enter the amounts in euros and round them out to the nearest ten cents.

How to report the annual information

The deadline for submittal is 15 February the year after the reporting calendar year. If the deadline falls on Saturday, Sunday or other holiday, the due date is extended to the next business day, i.e. the submitted filing must arrive at the Tax Administration on that day. Deadline for submitting the information for 2022 is 15 February 2023.

Making corrections, completing the data elements for identification

For year-specific instructions for making corrections, go to Making corrections to annual information returns.

When mistakes and errors are remedied afterwards, the most recent submitted filing is the one that remains in force, replacing the previous filing(s). For one beneficiary, there can be no more than just one return submitted with the same identification. If you need to make correction to the identifying details that you had filed previously, you must first delete the original return. Then file a new return with the correct identifying details.

The identification items relating to this information return are:

• The identifier of the return, i.e. the “flow” (only when you submit electronically)
• Payor's ID
• the Business ID of the account operator or other third-party filer that submits the return (this data element is among the identification details only if the ID has been issued)
• ID code of the securities depository where the security was issued (only when you submit electronically; only if this information is given)
• Year of payment
• Type of interest
• ISIN code of the bond or debenture
• Official name of the bond or debenture, and
• Identifier of the software that generated the file (only when you submit electronically)

How to compute the tax to be withheld at source

The calculation rule for the tax at source on interest income is that each amount of interest paid must be treated separately and the amounts must be rounded down to the nearest ten cents.

If you paid interest to beneficiaries in non-euro currencies, you must convert the amounts into euros in accordance with the exchange rate quoted by the European Central Bank, valid on the date of payment.

Type of interest (8)

8A = interest on bank deposit balances

8B = interest on bonds/debentures

8C = Interest on the balances of deposits in employee banks (personnel service offices), of client accounts in payment institutions, and interest paid by the Finnish branch offices of foreign payment institutions.

The '8A' type includes banks and cooperative savings offices accepting deposits from the public, the '8B' type includes bonds and debentures and '8C' includes employee banks, payment institutions and the Finnish branches of foreign payment institutions. The entries you make on the annual information return must itemize the interest on deposits bank-by-bank, the interest on bonds and debentures separately for each issued bond or debenture, the interest on deposits in employee banks separately for each employer, and the interest on the balances on client accounts in payment institutions separately for each payment institution involved.

Total paid interest

Enter the total amount of interest paid out and taxable at source. Typically, the beneficiaries of such interest are tax-resident individuals in Finland – i.e. physical persons fully liable to tax – or estates of deceased persons in Finland. Sometimes the beneficiary is a corporate entity, partnership or a consortium. As the payor of interest, you must withhold tax at source if the corporate entity, partnership or consortium has not given enough information on its tax status to you. Report the paid amounts here.

Total amount of tax at source on interest

This line is for the total amount of tax withheld at source on the paid-out interest. If the Tax Administration has expressly demanded this, you must also list the names, registered domiciles and amounts of paid interest of any resident beneficiaries for whom no tax has been withheld at source.

The party paying interest

Enter the payor’s Business ID. Payors of interest are depositary banks, Finnish branches of foreign credit institutions, payment institutions, Finnish branches of foreign payment institutions, employee banks set up by employers to provide their personnel with financial services, and issuers of bonds and debentures. 

Payors of interest must be categorized as follows:

01 Bank accepting deposits from the public
02 Employee bank (personnel service)
03 Finnish branch office of a foreign credit institution
04 State of Finland
05 Domestic payment institution
06 Other issuer of bonds and debentures
07 Finnish branch office of a foreign institution

The person to contact

If someone other than the payor files the annual information return – such as a bank that acts as the intermediary and pays the interest on behalf of the issuer of the bonds – indicate the names of both the bank and the person to contact.

Starting from the 2017 reporting year, no terms and conditions of convertible loans or of clearance accounts need to be delivered to the Tax Administration.