How Finland taxes a retirement plan
Every figure this model charges in Finland, what each one means, the tax office page it came from, and the date we last read it. Plus everything the model does not do here.
The tax chapter of what the model assumes about Finland.
Figures are for the 2026 tax year, read from the authorities on 2026-07-27. Every one of them links to the page it came from. 2 of them we could not source: we hold the figure and could not find an authority page stating it. Those are marked, and they are the ones most likely to be wrong. If you know better, tell us.
Checked against their published tables. That check reaches part of the calculation, not all of it; the rest is worked through by hand from the authority's own rules.
The scale your pension and other ordinary income are charged on. Each band's rate applies only to the part of your income inside it, not to all of it.
Pension income allowanceelaketulovahennys
A large allowance taken off pension income before tax is worked out. It shrinks as your pension grows and is gone entirely a little above 49,300 a year, and it rises with prices.
- Shrinks by51%
- How much is withdrawn per unit of income above the starting point. This adds to your effective rate inside that range, often sharply.
- source
- Cannot exceed the incomeyes
- The deduction is limited to the income it is set against, so it cannot create a loss.
- source
- Couple's shrink point2
- What the income at which it starts shrinking is multiplied by for a couple.
- source
Basic allowanceperusvahennys
A smaller allowance applied last, against whatever income is still taxable once the pension allowance has been taken. Its amount is fixed and does not rise with prices, so it quietly loses value over a long plan.
Extra tax on larger pensionselaketulon lisavero
An extra 5.85 percent on the part of a pension above 60,000 a year, charged on top of ordinary income tax. It falls on pension income only, not on anything you withdraw from savings.
- Charged onpension
- Which figure the charge is worked out from: your income, or the tax you already owe.
- source
Public broadcasting levyyleisradiovero
A levy that funds public broadcasting, charged at 2.5 percent of income above 15,150 and capped at 160 a year. The cap is reached at 21,550 of income, so most retirees simply pay a flat 160.
- Charged onpre allowance combined
- Which figure the charge is worked out from: your income, or the tax you already owe.
- source
How money held outside a retirement account is charged: on what it pays you each year, on the profit when you sell, or both.
- Charged howseparate
- Whether investment income joins your other income on the same scale or is charged separately. It decides whether taking more from your portfolio pushes your pension into a higher band.
- source
- Charged as it pays outno
- Whether income the investment pays you is charged in the year it arises, rather than only when you sell.
- source
What a loss can be set against, and whether anything left over can be carried into future years.
- Carried forward for5
- How many years an unused loss survives to be set against future gains. Zero means it is lost at the end of the year.
- source
- Locked to one kind of assetno limit
- A loss on one kind of investment can only be set against gains of the same kind.
- source
- Against other income, up tono limit
- The most a loss can take off your ordinary income in one year.
- source
- Share usable against other income0
- How much of a leftover loss can be set against income that is not investment income.
- source
Whether a couple is assessed as one household or as two people, which can change the bill substantially at the same total income.
- How a couple is assessedsplitting
- Whether the two incomes are pooled, split evenly, or taxed entirely separately. At the same household income these give very different bills.
- no source found
- Shares the income is split into2
- The household income is divided by this, taxed, then multiplied back. It lowers the bill whenever one partner earns more than the other.
- no source found
equity
Where this country's answer changes depending on the kind of investment, this is what we assume unless you say otherwise.
A threshold frozen in law quietly costs more every year, because your income rises with prices and the threshold does not. Over a thirty-year retirement that is one of the larger effects on this page.
- the income tax bands · Keeps up with inflationyes
- If no, this figure is fixed in law. Your income rises with prices and it does not, so it costs you more every year without any rule changing.
- source
- an ordinary investment account · Keeps up with inflationno
- source
- elaketulovahennys · Keeps up with inflationyes
- source
- perusvahennys · Keeps up with inflationno
- source
- elaketulon lisavero · Keeps up with inflationno
- source
- yleisradiovero · Keeps up with inflationno
- source
- sairausvakuutuksen sairaanhoitomaksu · Keeps up with inflationyes
- source
Where you live inside the country
Tax here is not the same everywhere. The planner asks where you live and charges your own jurisdiction's figures. Skip the question and it charges a stand-in, and says on screen which one.
The planner carries all 292 councils.
They charge between 4.7% in Kauniainen and 10.9% in Pomarkku. Say nothing and you are charged 7.57%.
What this model does not do here
Every one of them, not a selection. 9 are described below.
We model these and we know we do not get them exactly right. Where the size could be measured, it is stated.
Finland taxes spouses entirely separately and moves nothing between them. We give a couple two full sets of the pension and basic allowances. That is exact when both partners draw a similar pension, and too generous when only one of them draws anything: a one pension couple's tax is understated by somewhere between about 4,340 and 6,670 a year, and where in that range depends on both the pension and the municipality.
Your real tax is higher/up to €6,670 a year/couples where only one partner has a Finnish pension; the amount depends on their municipality as well as their pension
Finland's municipal tax is set by the municipality you live in, and the rate runs from 4.7 to 10.9 percent. Tell us your municipality and we charge its own rate. If you do not, we charge the national average of 7.57 percent, and between the cheapest municipality and the dearest that is worth about 2,370 a year on the largest pension we tested. The average is weighted by population and the big cities are the cheap ones, so 265 of the 292 mainland municipalities charge more than it.
Could go either way/up to €2,367 a year/anyone retiring in Finland who does not name their municipality; the rate depends on which of the 292 mainland municipalities you live in
The Åland Islands set their own municipal rates, 17.0 to 19.7 percent, against a state scale cut by 12.64 points to compensate. Count both halves and an Åland resident ends up below the mainland average that we charge everybody. Åland is not one of the municipalities you can pick, and we charge the mainland figure, so if you retire in one of Åland's 16 municipalities the tax we show is too high.
Your real tax is lower/anyone retiring in the Åland Islands
Interest from a Finnish bank deposit or a Finnish public bond is taxed once at a flat 30 percent and then set aside: it never joins the rest of your capital income, so it never reaches the 34 percent step, and a loss elsewhere cannot reduce it. We treat all interest as ordinary capital income instead. We ask nothing about bonds or cash on purpose, because we cannot yet route one income stream out of the capital scale, and a menu we could not tax correctly is worse than no menu.
Could go either way/anyone holding Finnish bank deposits or Finnish public bonds, above all with capital income past 30,000 a year
These exist in law and we leave them out, usually because applying them would need a question we do not ask.
If your voluntary pension premiums or deductible loan interest come to more than your capital income, Finland gives you a credit against your income tax worth up to 1,400 a year. We never give it. Anyone drawing down a portfolio has capital income, so it rarely fires at all, but where it would have fired the tax we show is too high.
Your real tax is lower/up to €1,400 a year/a Finnish retiree whose loan interest or voluntary pension premiums outrun their capital income
Members of a Finnish church pay church tax on top of their income tax, averaging 1.38 percent. Membership is voluntary and we never ask, so we leave it out entirely. If you are a member, every tax figure we show for Finland is too low by roughly that much.
Your real tax is higher/members of the Finnish Evangelical Lutheran or Orthodox church
A dividend from a company in a country Finland has no tax treaty with is charged on the earned income scale rather than as capital income. We always treat dividends as capital income. This reaches neither regulated European funds nor anything from a treaty country, which is very nearly everything a retiree holds, and where it does reach you it can land either side of what we show.
Could go either way/anyone holding shares directly in a company outside Finland's treaty network
Finland leaves two gains untaxed that we tax anyway. If everything you sell in a year adds up to 1,000 or less, the gain on it is free of tax. So is the gain on selling your own home. We apply neither exemption, so in a year where one of them would have covered you, the tax we show is too high.
Your real tax is lower/anyone selling almost nothing in a year, and anyone selling the home they live in
Finland has an equity savings account, the osakesaastotili, and we do not offer it as a choice. It takes at most 100,000 of deposits, holds only shares listed in the European Economic Area, and on our own reading it loses to a plain accumulating fund once more than 60 percent of your holding is gain. Finland has no tax free wrapper of any kind, which is why we never ask you to split your money between account types.
Could go either way/anyone weighing a Finnish equity savings account against an ordinary fund
Every other figure we use for this country (310)
The sections above cover what shapes a retirement plan. These are the rest of what the model reads, listed so nothing it uses is hidden from you.
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Health insurance contributionsairausvakuutuksen sairaanhoitomaksu
A health charge of 1.49 percent, taken on what is left of your pension after both allowances rather than on the gross amount. It funds public healthcare and is collected with your income tax.