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Short term and occasional rentals

You are always receiving taxable income when someone pays you rent – this also applies to occasional, short-term rental contracts.

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Have you rented out an apartment or other property on an application or website? The Tax Administration receives information on income you gain on digital platforms, both from Finland and from abroad. The Tax Administration also supervises the reporting of these details for tax assessment. Remember to always report this type of income on your pre-completed tax return.

Renting out residential or vacation property for a short time

You need to inform the Tax Administration of your rental activities although it might be that your rental income is low, and after the expenses you have little or no income subject to tax. See guidance for filing and payment.

You can claim the tax-deductible expenses of renting:

  • If you had to spend money when you searched for a new tenant, you are entitled to claim these expenses fully.  Examples include advertisements, fees paid to digital platforms, and other direct expenses.
  • For other types of expenses, you are entitled to partial deductions: you need to claim them by reference to the length of time that your rental property was rented to a tenant, and by reference to the square metres the tenant occupied. For example, if 50% of your apartment’s square metres were rented under several short-term contracts for few days at a time, and the total count of the days equals one month, you can claim a tax deduction for 50% of one month’s maintenance charges. Read more about deductions.

Rental of your home for a short time can affect the tax exemption for selling residential property

In general, a capital-gains exemption for selling your home is available to all individual taxpayers, if you live there for two years without interruption. However, if you rent out your home, even for a short time, the counting of time for the two-year period is discontinued. This may cause that although the other requirements for tax exemption were fulfilled, you become liable for paying a capital-gains tax if the selling price is higher than the purchase price was.

What can be deducted against rental income from timeshares?

In the case of a timeshare property, you can only claim the expenses you had to pay while the property was rented out and the direct expenses of your activity to rent out the property. This applies to a situation where you have obtained the property for your personal use but you offer it for occasional short-term rentals.

It does not matter whether the timeshare property is rented out directly or through an agent.

Example: Henri rents out his timeshare property in Levi. He signs a contract with an agent to deal with the rental customers. According to the contract between Henri and the agent, the property can be rented out during weeks 2–14 and weeks 16–52. Weeks 1 and 15 are reserved for Henri’s personal use. 

One year, the timeshare property was rented out during weeks 12–14, 16–18 and 51–52. Henri’s rental income amounted to €400 × 8 weeks = €3,200. Henri used the property himself during weeks 1 and 15. However, Henri’s grown-up children stayed there for a total of 6 weeks. The rest of the time the property was empty.

Henri paid the following overhead costs: €150 per month for maintenance (co-operative charges, etc.), plus expenses of renting – €50 for brochures and maps for tenants and the agent’s annual fee of €200.

Henri is only entitled to claim the expenses he needed to pay while the property was rented out. The property was rented out for a total of 8 weeks. As a result, he can claim:
– 15% of the overhead (8 weeks out of 52 = 15%), and 
– 100% of the direct expenses of Henri’s rental operation.

The period of personal use was 44 weeks (52 – 8 weeks).
Henri can submit the following claim: 
– Deduct overhead expenses, 15% × (12 months × €150) = €270 
– Deduct direct expenses of renting, €200 + €50 = €250
The total deduction from Henri’s rental income equals €520. The rest is considered to relate to personal use and cannot be deducted. Henri’s net rental income subject to tax is €3,200 – €520 = €2,680.

Read more about vacation property rentals. (in Finnish and Swedish)

Occasional rentals of privately owned vehicles, other property, articles of clothing

You need to inform the Tax Administration of your rental activities although it might be that your rental income is low, and after the expenses you have little or no income subject to tax. See guidance for filing and payment.

You can claim the tax-deductible expenses of renting:

  • If you had to spend money when you searched for a new customer or tenant, you are entitled to claim these expenses fully.  Examples include advertisements, fees paid to digital platforms, and other direct expenses.
  • For other expenses, you are entitled to partial deductions. These include your expenses for maintenance and upkeep. When claiming these, you need to limit the claim to the period of time when the rental property item was actually rented. Read more about deductions.

Examples of occasional rentals and associated deductible costs

Example: Renting out a trailer
Recently, you bought a trailer for transporting goods. The trailer has a hood to protect the goods from rain. You signed up with a platform to connect with other people who might want to rent the trailer from you because otherwise the trailer would be unused for most of the time. The purchase price was €1,700 and the required motor insurance is €30 a year.

During the past year, you rented out the trailer for 15 days and received €450 of gross rental income. The platform keeps a 5-percent service fee.
As a result, you can claim the 5% – or €22.50 – of service fees against your rental income. This amount is a direct expense of renting. In addition, you can claim the part of the insurance premiums corresponding to the trailer’s rental period. This deductible amount is €1.23 (= 15/365 × €30).
No part of the trailer’s purchase price is deductible because the trailer is not primarily with an intent to gain or produce income.

Example: Car rental
You offer your privately owned car for rent using a digital platform. The car’s purchase price was €26,000 when new. Its motor insurance premiums amount to €1,000 a year. In addition, you have paid €350 in expenses for regular maintenance and vehicle inspection.
During the past year, you rented out the car for 50 days and received €1500 of gross rental income. The platform keeps a 5-percent service fee.  
You can claim the entire 5% – or €75 – of service fees against your rental income. In addition, you can claim the part of the insurance and maintenance that is related to the number of days when the car was rented out. This deductible amount is €184.93 (= 50/365 × €1,350).
However, the car’s purchase price cannot be deducted even partially because the car is not considered rental property, i.e. not used primarily for production of income through a rental operation.

Example: Parking space 
You own a parking space. You agree to rent it to someone for the summer (3 months). The price of the housing-company shares that give you the right to the parking was €28,000. The monthly charge you need to pay to the housing company is €25. You also had to pay €20 for posting a rental advertisement on the web.

Gross rental income for the summer equalled €450. You can claim the €20 for the rental ad against your rental income because advertising costs are a direct expense of renting. In addition, you can claim the housing-company charges for the rental period, which comes to €75 (= 3 x €25). However, the purchase price of the shares cannot be depreciated or otherwise deducted in the taxation of rental income.

Example: Renting out accessories
You are a user of a digital platform where you offered a designer handbag worth €1,800 for rent to a short-time customer. You like to offer it for rent because it is designed for festive occasions and celebrations and would be unused for most of the time if you didn’t rent it out to others. The platform keeps a 20-percent service fee of the rental income.

Your gross rental income subject to tax from handbag rentals is €650 this year. You can deduct the twenty percent i.e. €130 of service fees from it. However, you cannot claim deductions concerning your handbag’s purchase price because you don’t use the handbag for a primary intent to gain income.

Rental income you receive from a sub-tenant

You are always receiving taxable income when someone pays you rent – this also applies to a rental contract where you are the primary tenant and you let a sub-tenant occupy the apartment you are renting. You must report this income although it might be that it has been low, and after deductible expenses you have little or no rental income subject to tax. See guidance for filing and payment.

You can claim deductions against your rental income, based on the direct expenses of renting you need to pay. If you have a sub-tenant, you can claim an appropriate part of your personal rent payments against the rental income you get from your sub-tenant. The deductible amount is the same as the amount you pay yourself regarding the part of the apartment’s space that your sub-tenant occupies. Read more about deductions.

Example: Hanna is the primary tenant living in a 65-square-metre apartment. Her rent is €1,500 per month. It includes electricity and water.

From 1 March 2023, Hanna has been subletting a 12-square-metre room to Heidi. The girls share the kitchen and the bathroom, which together measure 28 square metres. Heidi pays Hanna €700 per month of rent.

Hanna’s gross rental income for 2023 amounts to €700 × 10 months = €7,000. She can deduct any direct expenses of renting. The appropriate part of the rent that Hanna herself pays is a deductible expense. It represents the part occupied by Heidi: (12 sq. metres + 28 sq. metres × 50%) / 65 sq. metres × €1,500 × 10 months = €6,000. Hanna’s taxable rental income therefore amounts to €1,000.

Page last updated 4/29/2024