Finnish taxes on an inheritance that comes from a foreign country
If you inherit assets, property,w or a sum of money, you must submit a tax return to give details on your inheritance to the authorities and pay inheritance tax to Finland. The following are examples of circumstances where inheritors must pay inheritance tax to Finland:
- The decedent lived in Finland. You live outside of Finland and you inherit a house or apartment not located in Finland. You must pay Finnish inheritance tax. Not only the inheritors who live in Finland but also those living in a foreign country must pay inheritance tax to Finland.
- The decedent lived in another country, not Finland. You live in Finland and you inherit cash. You and all the other inheritors living in Finland must pay inheritance tax to Finland.
- The decedent lived in another country and so do you. You inherit a summer cottage located in Finland. You must pay inheritance tax to Finland, however, only for the summer cottage because it is treated as immovable property.
After an individual who lived in Finland has died, the assets and property left behind are first inventoried and a deed is drawn up. The deed of estate inventory then takes the role of a tax return shared by all the inheritors. If the assets and property are located in another country, every inheritor must submit a separate inheritance tax return, because the estate inventory deed is not used in cross-border circumstances. The Finnish Tax Administration processes the information submitted on the deed of estate inventory or on the inheritance tax returns, calculating the amounts of inheritance tax to be imposed. Read more on heirs’ and inheritors’ rights under Finnish law
However, exceptions can be made because of the provisions of a bilateral tax treaty. Such treaties governing inheritance tax are in force with Denmark, Iceland, France, the Netherlands, Switzerland and the United States of America. If you have already paid tax to a foreign country on an inheritance you have received, you may be given credit for it when your Finnish inheritance taxes are assessed. Read more about how to receive credit for tax paid to a foreign country
You live outside Finland, the decedent lived in Finland
If someone dies who has lived in Finland and you receive some assets or property as an inheritance, you must pay Finnish inheritance tax even if you live elsewhere. Read more about Finnish tax rules regarding inheritance taxes
Example: Emil, the decedent, lived in Finland on his date of death. Emil’s only inheritor is Risto. He lives in Germany. Risto must pay Finnish inheritance tax on the entire inheritance.
You live in Finland, the decedent lived in a foreign country
If you live in Finland and receive an inheritance from another country, you must pay inheritance tax to Finland. You must complete an inheritance tax return and send it to the Finnish Tax Administration. How to file the tax return on a foreign inheritance
Property is in Finland – neither you nor the decedent lived in Finland
If you live in a foreign country but you receive immovable property located in Finland as an inheritance, you must pay Finnish inheritance tax on it. “Immovable property” refers to
- various types of real estate such as a lot where a building can be constructed, summer cottages, other recreational property or residences, agricultural farms, forestry farms
- the stocks or shares of a corporate entity with a net worth of which more than 50% consists of immovable property in Finland – including shares in a housing company (asunto-osakeyhtiö; bostadsaktiebolag)
You must complete an inheritance tax return and send it to the Finnish Tax Administration. How to file the tax return on a foreign inheritance
No inheritance tax return is necessary if the decedent lived in a foreign country, and you the inheritor also live in a country other than Finland, and the assets left behind contain no immovable property as described above.
Example: When Erkki died, he lived in Sweden. Salla, his daughter, lives there too. Kaisa, Erkki’s other daughter, lives in Finland. Erkki leaves behind an inheritance that consists of a house in Sweden and a summer cottage in Finland. Salla must only pay inheritance tax to Finland on the part located in Finland of her inheritance, that is, on the portion of the summer cottage that she inherited. Because Kaisa lives in Finland, she pays inheritance tax to Finland on all the property she inherits from Erkki.
Pay the inheritance tax
After processing the deed of estate inventory or the inheritance tax return, the Finnish Tax Administration decides on the tax that must be paid on the inheritance. After the deed or the return has been delivered to the Tax Administration, you receive a decision on inheritance tax in 6 to 12 months.
The due dates and instructions for payment are provided in your tax decision and in MyTax. If you are a user of MyTax, you can find the decision on inheritance tax there. If you cannot sign in to MyTax, look up the information about your inheritance tax on the decision letter that you received by post.
If your inheritance tax is less than €500, you must pay it on one single due date.
Other taxes relating to property and assets
After you inherit immovable property – a summer cottage, etc. – you become liable to the taxes that are related to your ownership. For example, owners of summer cottages must pay real estate tax every year.
If you decide to sell your inherited property to someone and you make a profit on that sale, you may have to pay capital gains tax to Finland. Tax on the received capital gains must be paid to Finland if you live in Finland yourself or if the sold property is located in Finland.
Further guidance on inheritance
The Finnish Tax Administration’s in-depth guidance on inheritance taxes (in Finnish and Swedish). We recommend that you read our guidance before sending your estate inventory deed or inheritance tax return.