Managing director or member of a governing body – how to take care of your taxes in Finland

Do you receive remuneration for acting as a member of the board of directors, a managing director, a member of the supervisory board or the chair of the annual general meeting? The remuneration you receive is always regarded as salary in Finnish tax assessment, even if it is paid to your company or employer. 

If you live in Finland and receive remuneration for being a managing director or a member of a governing body, you usually pay tax to Finland. Whether you receive the income from Finland or abroad is unimportant. However, if you are a foreign company’s managing director or board member, Finland's right to tax may be limited by a tax treaty

If you receive remuneration for being a member of the board of directors or another governing body in a Finnish organisation or partnership, your remuneration is regarded as income taxable in Finland. It makes no difference what your country of residence is or whether the meeting is held in another country, or whether you participate in the meeting online. 

If you stay in Finland for 6 months or less, the tax to be withheld at source is 35% of the remuneration. 

The tax at source is a final tax, so you do not need to file a tax return in Finland. Your employer gives you a pay slip that specifies your income and the tax withheld at source. Keep the pay slip for future use. It may be needed in your home country’s tax assessment for the elimination of double taxation. 

If you stay in Finland for more than 6 months, your Finnish tax rate will depend on your income. 

If you receive remuneration for acting as a managing director, and if you work mostly in Finland and your employer is Finnish, you pay tax to Finland. The managing director’s remuneration qualifies for a tax-at-source deduction of €510 per month or €17 per day.  

If you stay in Finland for 6 months or less, the tax to be withheld at source is 35% of the remuneration. 

The tax at source is a final tax, so you do not need to file a tax return in Finland. Your employer gives you a pay slip that specifies your income and the tax withheld at source. Keep the pay slip for future use. It may be needed in your home country’s tax assessment for the elimination of double taxation.  

If you stay in Finland for more than 6 months, your Finnish tax rate will depend on your income.  

Report the income received from Finland on the tax return of your country of residence 

When you submit your tax return to your country of residence, include the following items: 

  • the income you have received from Finland
  • the taxes you have paid to Finland.

If you also pay tax on your income to your country of residence, the country of residence will eliminate the resulting double taxation.