Refunds of VAT, excise duties and other self-assessed taxes
You can receive a refund of self-assessed taxes in the following situations:
- The VAT balance of your company is negative, i.e. you have more VAT to deduct than to pay.
- If this situation concerns your company, please note the new tax-refund rules affecting periods starting 1 January 2022, particularly if the negative balance of VAT is diminished. Read Example 3 under “Immediately after processing” below.
- The self-assessed tax that you already paid is adjusted, and its amount is lower than the amount you paid to the Tax Administration. This may be due to a mistake in your original tax return that has been corrected later.
- You have sent the Tax Administration a payment and you entered the bank reference number for self-assessed taxes in the bank transfer, but your payment has not been used.
- You have submitted an application for refund (e.g. application for refund of excise duty) and the Tax Administration has accepted it.
If you have any overdue taxes or other unpaid charges, etc., the refundable amount will first be used on those before any remaining refund can arrive in your bank account. If your company is on a payment plan, your refund can also be used on tax debts included in the plan. Additionally, the Tax Administration can use your refund to settle any business-related taxes that you owe because of your third-party liability (as a shareholder of your company or partnership, etc.). If an amount that would otherwise be refunded is applied on any taxes, you are notified of it on the tax summary and in MyTax. The Enforcement Authority may also impose a distraint on such an amount if your taxes are in recovery. In this case, the Enforcement Authority would notify you of the enforcement process.
After the Tax Administration has processed your request for refund, you should receive the refund in your bank account in a week. The Tax Administration sends the refund to the bank account number that you have given to the Tax Administration. Refunds below €10 are not paid out.
You can change the refund time in MyTax
The Tax Administration pays refunds for self-assessed taxes immediately after processing, if you have not set a refund limit or selected a different refund time in MyTax.
You can log in to MyTax to adjust the settings of refund time and refund limit. You can select whether the refund is sent to your company immediately or whether it remains in the account to cover the company’s upcoming taxes.
However, if any of your taxes are overdue already, your refund is used on them. After this, only the remainder of your refund balance is sent to your bank account. Amounts that would otherwise be refunded are used this way, even if you are currently on a payment plan. The enforcement agency may also impose a distraint on such an amount if your taxes are in recovery by enforcement.
See the guidance: How to change the refund time and refund limit in MyTax
Available refund times
This option means that the Tax Administration sends the refund to the taxpayer’s bank account immediately. The amount is not kept on hold for upcoming taxes. However, the earliest possible date for refunds of negative VAT is after the general due date of the next month after the tax period. Please note that if the Tax Administration has not used some of your previous payments, you must submit a specific request to have the remaining amount sent back to you. For more information, see Refunding an unused payment below.
Example 1: Your company’s tax period is the calendar month. On 4 March, you file a tax return for self-assessed taxes indicating that your company has negative VAT for January. Your tax return also contains employer’s contributions for February and excise duties for January. Your company has paid all its taxes. The negative VAT is refunded as soon as the tax return is processed. The refund is not kept on hold to wait for 12 March when the employer's contributions and excise duties fall due.
Example 2: Your company’s tax period is the calendar month. On 4 February, you submit a return indicating negative VAT for January. You submit another report for employer's contributions for February. Your submittals arrive at the Tax Administration on 4 February, in other words, they arrive before the general due date of the month after the tax period (in this case, 12 February). Additionally, your company has made a payment arrangement to cover some other taxes that had fallen due previously.
The negative VAT will be used on the employer’s contributions that fall due 12 February. After that, the remaining negative VAT will also be used on the other overdue taxes that your company’s payment arrangement covers. This must be done before sending any money to you. If any of your company’s tax debts are currently under enforced recovery, it may be that the Enforcement Authority uses some or all of the amount. After the above steps have been taken, if any negative VAT remains, it is refunded to your company in approximately one week.
Example 3: A negative VAT balance is applied on excise duties. On 12 March, your company submitted a VAT return for January, indicating €500 of negative VAT. Also on 12 March, €5,000 of January’s excise duty on alcohol falls due. The negative VAT is used in order to pay for some of the excise duty on the due date.
Making corrections to a reported balance of negative VAT, when the end date of the tax period has been 31 December 2021 or an earlier date:
Your company submits a corrected VAT return to adjust the 500-euro negative balance that was reported on 12 March: the corrected negative balance stands at €300.
Because the amount of €500 that was intended to cover the excise duty on alcohol is now diminished, your company must pay €200 in excise duty in order to make up for the difference. A further consequence of the diminished negative VAT is that there will be interest, collected from 13 March onwards, i.e. from the day after the due date.
Making corrections to a reported balance of negative VAT when the tax period’s start date is 1 January 2022 or later:
There are changes in 2022 to negative-VAT refunding. The changes affect VAT for tax periods that begin 1 January or later. The new rules only have an impact on the reporting of a negative VAT that diminishes the original negative balance; in other words, the sum total of VAT payable becomes higher because the negative value becomes lower. If the Tax Administration had applied the company’s original refund, which had been reported incorrectly and therefore is unfounded, as coverage for an owed amount – such as an excise duty on alcohol – the Tax Administration would reclaim the amount from you. The refund is reclaimed instead of collecting the excise duty again.
This means that the Tax Administration would no longer issue a cancellation of the 500-euro balance of negative VAT, as a result, no repeated payment of the excise duty on alcohol is required of the company. Instead, the company must pay an additional €200 of VAT. The reason is that the negative VAT had diminished by €200 because of the corrections that were made.
In addition to the above, the company must pay some late-payment interest. The original VAT return of 12 March had indicated a too high negative balance of VAT. As a result, the day when the collection of interest begins is 13 March. Companies can log in to MyTax to check how much VAT plus interest must be paid on any date when they plan to pay it.
If you select this option, the amounts that would otherwise be refunded will wait for the next general due date for self-assessed taxes, i.e. the 12th of the next month. If the 12th day is not a banking day, the due date will be the first banking day after it. After the self-assessed taxes that fell due on the 12th have been covered, the remaining amount is used on any other unpaid taxes or on overdue taxes that the taxpayer has a payment arrangement for. The enforcement agency may also impose a distraint on a refund if the taxpayer’s overdue taxes have been transferred to recovery by enforcement. If some of the refund still remains, it will be paid out after the 12th.
If you select this option, any unused payment that you have made with the reference number for self-assessed taxes will also be refunded to you.
Example 4: Your company’s tax period is the calendar month. On 4 March, you file a VAT return where you report negative VAT for January, and employer’s contributions for February. At the time when you file the return, the next due date is 12 March. The negative VAT will be used on the employer contributions that fall due on that date. Any remaining negative VAT will then be used on other overdue taxes that your company may have. The Tax Administration will pay the rest into your company’s bank account.
Example 5: On 15 March, a company files a VAT return that indicates that there is a balance of €1,000 of negative VAT from February. As it happens, this company has neglected its employer's contribution payments for February. The due date for the contributions would have been 12 March. As a result, employer's contributions and a late-payment interest on them will be covered by €400 of the negative VAT from February. Then, out of the €600 that is still left, €380 is used to cover the next set of employer’s contributions that fall due on 12 April, which is the next general due date after the date when the company filed its return. The remaining €220 is then refunded into the company’s bank account.
Note: If you submit a VAT return indicating negative VAT or if you pay self-assessed taxes exactly on their due date, any excess amounts will be refunded to you immediately after the due date has passed.
Example 6: On 12 May, a company files its VAT return for March, indicating that €3,000 of VAT should be refunded to the company. The company’s employer's contributions for April, amounting to €5,000, fall due on 12 May as well. The company sends €5,000 to the Tax Administration in order to pay the employer's contributions on that day. The Tax Administration uses the company’s negative VAT balance immediately on 12 May on the employer's contributions. This leaves €3,000 unused of the €5,000 that the company had just sent. After that, the Tax Administration refunds the unused €3,000 to the company.
If you select this option, the amounts that would otherwise be refunded will wait for any upcoming taxes or other amounts to fall due that you must pay to the Tax Administration. This means that the refund is not automatically paid to your bank account. Your payments and all your refunds of self-assessed taxes are kept on hold: negative VAT, refunds due to a decrease in the amount of tax, requested tax refunds and credit interest. Nevertheless, you are entitled to submit a request for refund. Submit the request in MyTax. After that, your refund is sent to you if there is nothing to prevent the Tax Administration from refunding it.
However, on the end date of each calendar month, any unused payments or refunds will be used on your tax debts, including taxes covered by a payment arrangement and any unpaid back taxes or prepayments.
Example 7: Your company’s tax period is the calendar month. On 3 March, you file a VAT return that indicates €10,000 of negative VAT for January and €8,000 of employer contributions that you must pay for February. The Tax Administration uses the negative VAT on the employer's contributions on 12 March, and the rest remains waiting for your upcoming taxes. In March, your company neglects to pay its income-tax prepayment, €1,000. The due date of this prepayment would have been 23 March. Some unused negative VAT still remains at the end of the month of March. In this situation, the Tax Administration will use the negative VAT on the unpaid prepayment and the late-payment interest accrued on the unpaid prepayment from 23 March to 31 March.
Example 8: A taxpayer has requested a refund of excise duty on liquid fuels. The amount requested was €1,500 and the request was accepted on 8 March. Additionally, the taxpayer must pay €900 in VAT. It falls due for payment on 12 March. As a result, an appropriate part of the excise-duty refund is applied on the VAT falling due. The remaining €600 is kept on hold for the taxpayer’s upcoming taxes.
Setting a refund limit in MyTax
You can set a limit for the refund amount if you selected either "Refund immediately after processing" or "Refund after the next general due date" as your refund time. After you have set the refund limit, the Tax Administration will only send you the amounts that go over the limit. Refunds equal to or below the limit will remain waiting for your upcoming taxes. However, even if you have a refund limit, the Tax Administration may use the money that would otherwise be refunded on other taxes or debts you may have at the end of the month.
You can receive credit interest on a refund
An amount kept on hold earns interest. This is called credit interest. The interest rate is the reference rate of Bank of Finland that was in force during the six months preceding the current calendar year, minus two percentage points. However, it cannot be less than 0.5%. The interest rate is reviewed every year. In 2022, the rate for credit interest is 0.5%. If you receive credit interest, is not regarded as income subject to tax.
Refunds are paid into bank accounts
The Tax Administration sends your refunds to the bank account that you have given us. Please note that the Tax Administration database can only have one bank account number per taxpayer. You can submit or change your bank account number in MyTax.
See the guidance: How to submit a bank account number in MyTax
If you do not submit your bank account number on time, the Tax Administration will send the refund to you as a money order through the Nordea bank. However, refunds that amount to less than €15 are not paid in the form of a money order unless you have asked for a money order. For instructions on how to have the refund cashed, see the money order that the bank sends you. You can receive a money order only to a Finnish postal address.
No refunds for taxpayers that have not submitted all their tax returns
Refunds cannot be paid to taxpayers with neglected or incomplete tax returns relating to any type of tax. If you have not submitted a return when you should, information on non-filing will appear in MyTax the day after the deadline date.
Example 9: On 12 May, a limited-liability company files its VAT return for March. The amount of the VAT is negative. However, the company has neglected to file its income tax return for the previous year. The return should have been filed by 31 March. The Tax Administration will not pay a refund to the company. Instead, the company’s negative VAT is used on the company’s upcoming taxes. After the company has filed the income tax return, the Tax Administration will pay the remainder of the negative VAT into the company’s bank account. However, this requires that the company has paid all its taxes and that there is nothing else to prevent the Tax Administration from refunding the amount. The enforcement agency may also impose a distraint on a refund if the taxpayer’s overdue taxes have been transferred to recovery by enforcement.
If you quoted the reference number for self-assessed taxes when you sent a tax payment to the Tax Administration and the payment remains unused, you can submit a request for refund. However, if any of your other taxes have fallen due for payment, including any taxes covered by a payment arrangement, your unused payment will first be used for those. You can log in to MyTax to submit a request for refund: How to change selections relating to refunds of self-assessed taxes in MyTax.