These deductions are calculated automatically by the Tax Administration

Some deductions are included in the Tax Administration’s assessment calculation so you do not have to claim them when you file your tax return. In other words, some deductions are given to taxpayers automatically. The following deductions affect both your tax card and later the tax decision.

Deduction for the production of income when costs are less than €750

When you are a recipient of wage income you are given this deduction automatically. The standard amount is €750. The amount cannot be higher than the sum of your wage income per year. The deduction affects your wage income in the assessments of both state taxes and municipal taxes.

If you spent more than €750 on the production of income during the year, you need to list the expenses one-by-one when you file your tax return. 

Read more about how to deduct expenses for the production of income

Earned income allowance

The deduction called ‘earned-income allowance’ (ansiotulovähennys; förvärvsinkomstavdrag) will no longer be available starting 2025.

Earned-income allowance in 2024

You can be given the deduction called ‘earned-income allowance’ if you receive wages, profit-shares of a small business, or other comparable earnings. However, income consisting of a pension or of social benefits does not qualify.

The earned-income allowance concerns both state taxes and municipal taxes.

Amounts of the earned-income allowance in 2024:

  • The maximum deduction is €3,570.
  • The deduction is 51% if the amount of qualifying income is between €2,500 and €7,230. 
  • For the part that exceeds €7,230, the deduction is 28%.

If your net taxable earned income exceeds €14,000, the deduction is reduced by 4.5% of the exceeding amount. When it is reduced, all your earned income – including pensions, unemployment benefits and sickness allowance – is included as income.

If your net taxable earned income is more than €94,084, you cannot get this deduction at all.

Employment income credit

You can be given the tax credit for employment income i.e. work income if you receive wages subject to tax, profit-shares of a small business, or other comparable earnings.

The credit reduces your state income tax directly. If your state income tax is less than the amount of credit, the credit will reduce your municipal tax, church tax and health care contribution on a proportional basis.

Creditable amount in 2025:

  • The maximum credit for employment income is €3,225.
  • If you are a wage earner or self-employed individual, and you have turned 65 before the beginning of 2025, the maximum credit is €4,425. If you are younger, you are not entitled to any age-based increase that would affect the maximum credit.
  • The credit is 18% of qualifying income
  • The credit is reduced by 2.22% for the part of net taxable earned income exceeding €24,250, and by 3.44% for any part in excess of €42,550.
  • For each child under the age of 18 in your custody, you are entitled to a €50 increase to the maximum amount of the credit for work income.
    • If you are a single parent, the increase is doubled.

Creditable amount in 2024:

  • The maximum credit for employment income is €2,140.
  • If you are a wage earner or self-employed individual, and you have turned 65 before the beginning of 2024, the maximum credit is €3,340. If you are younger, you are not entitled to any age-based increase that would affect the maximum credit.
  • The credit is 12% of qualifying income
  • The credit is reduced by 2.03% for the part of net taxable earned income exceeding €23,420, and by 1.21% for any part in excess of €71,900.

Basic allowance

You can be given the basic allowance that reduces your taxable income such as wages and pensions. The allowance concerns both state taxes and municipal taxes. The basic allowance affects your earned income subject to tax. 

The size of the allowance in 2025:

  • The maximum deduction resulting from the basic allowance is €4,115.
  • If your net taxable earned income exceeds €4,115 after all the deductions applied in municipal taxation have been made, the deduction is reduced by 18% of the excess.
  • You are not entitled even to a partial deduction if your net taxable earned income after all the above deductions exceeds €26,976. 

The size of the allowance in 2024:

  • The maximum deduction resulting from the basic allowance is €3,980.
  • If your net taxable earned income exceeds €3,980 after all the deductions applied in municipal taxation have been made, the deduction is reduced by 18% of the excess.
  • You are not entitled even to a partial deduction if your net taxable earned income after all the above deductions exceeds €26,092. 

Pension income deduction

The amount of the deduction based on pensions depends on the sum total of the your taxable wage income and other earned income. The deduction reduces your net taxable earned income in state taxation and municipal taxation.

Amount in 2025:

  • In 2025, you can get the pension income deduction if your net taxable earned income is no more than €48,930.
  • The maximum deduction is €11,030.
    • If your net taxable earned income is higher than €11,030, the deduction is reduced by 51% of the excess.
    • If your net taxable earned income is higher than €22,500, the deduction is reduced by 19,6% of the excess.

Amount in 2024:

  • In 2024, you can get the pension income deduction if your net taxable earned income is no more than €55,927.
  • The maximum deduction is €10,920.
    • If your net taxable earned income is higher than €10,920, the deduction is reduced by 51% of the excess.
    • If your net taxable earned income is higher than €22,500, the deduction is reduced by 15% of the excess.

Disability credit if your municipality of domicile is on Åland

If your domicile is in the Åland Islands, you may be given the disability credit for residents of Åland.

You are eligible for the credit if your permanent degree of disability due to illness, injury or a comparable reason is 30%–100%. The maximum credit is €440.

As of 31 December 2022, disability credits are no longer available to people living in Finland’s mainland.

Deduction for study grants

You can get this deduction the year when you receive a study grant. Study grant deductions concern both state taxes and municipal taxes.

Deductions for study grants in 2025 and 2024:

  • The maximum deduction is €2,600 but the deduction cannot be greater than the amount of your study grant. If you receive wages or other earned income in addition to the study grant, the deduction will be reduced.
  • Half (50%) of your earnings in excess of €2,600 will be deducted from the deduction.
  • If your net taxable earned income is more than €7,200, no study grant deduction can be given you.

Tax credit for student loans

The student loan credit only applies to students who have started their degree program in higher academic education before 1 August 2014 for the first time.

If you have taken out a student loan and completed your degree within the target time, you may be eligible for the credit. The credit is granted for the years when you are repaying the loan.

The credit reduces your state income tax directly. If your state income tax is less than the amount of the credit, the credit will reduce your municipal tax, church tax and health care contribution on a proportional basis.

Kela decides whether you are eligible for the student loan credit and what the maximum amount of credit is. The Tax Administration grants you the credit based on the information received from Kela for every tax year when you are eligible. In other words, you do not need to claim the credit when you file your tax return.   

If you began your first course of study in higher education on 1 August 2014 or later, you may be eligible for Kela’s student loan compensation after your graduation. The student loan compensation is tax-exempt income. No pre-filled amount of the compensation is shown on your pre-completed tax return. There is no need to report the amount when you file your tax return for the year. Read more about the student loan compensation on Kela’s website. 

Deduction for seafarer’s income

You are entitled to this deduction if you receive seafarer's income. The deduction reduces your net taxable earned income in both state and municipal taxation.

Deduction amounts in 2025 and 2024:

  • The deduction is 20% of your total amount of seafarer's income. However, the maximum deduction is €7,000.
  • Moreover, if you receive more than €50,000 in seafarer's income, the maximum deduction of €7,000 is reduced. First, we calculate 5% of your income which is in excess of €50,000. Then the 5-percent amount is subtracted from €7,000.
  • You receive an additional deduction of €170 for each full calendar month when the ship or vessel does not visit Finland (the deduction for cross-trade work).
Page last updated 12/10/2024