How to Start a Business in Finland: A Complete Guide
Starting a business in Finland is a straightforward process, provided you understand the necessary steps. This guide covers everything from registering your business, obtaining loans, legal requirements, and accounting needs to help you establish a successful enterprise in Finland.
1. Choosing a Business Structure
In Finland, you can choose from various business structures based on your needs:
- Sole Proprietorship (Toiminimi, Tmi): Suitable for small businesses or freelancers. Registration is simple and costs less.
- Limited Liability Company (Osakeyhtiö, Oy): Ideal for larger businesses requiring more capital. Owners have limited liability.
- General Partnership (Avoin yhtiö, Ay): Requires at least two partners who share responsibility.
- Limited Partnership (Kommandiittiyhtiö, Ky): Includes both general and silent partners.
- Cooperative (Osuuskunta): A business owned and operated by its members.
For more details, visit the Finnish Patent and Registration Office (PRH): www.prh.fi
2. Business Registration Process
To register your business, follow these steps:
- Choose a business name and check its availability on the PRH website.
- Register your business via the Business Information System (YTJ): www.ytj.fi
- Apply for a Business ID from the Tax Administration.
- Register for VAT (Value Added Tax) if your annual turnover exceeds €15,000.
- If hiring employees, register with The Employer Register.
3. Applying for a Business Loan
If you need funding, Finland offers multiple loan options for new entrepreneurs:
- Finnvera: State-owned financing company providing startup loans. www.finnvera.fi
- Banks: OP, Nordea, Danske Bank, and others offer business loans.
- Business Finland: Grants and support for innovative businesses. www.businessfinland.fi
- Private Investors & Angel Investors: Look for venture capital firms or startup incubators.
4. Accounting and Taxation
Proper bookkeeping is essential. You can either handle it yourself or hire an accountant.
Mandatory Registrations:
Value Added Tax (VAT) Register- Prepayment Register (if paying taxes in advance)
- Employer Register (if hiring employees)
- Corporate Tax Rate: 20% for limited liability companies check vero for exact amount.
- Personal Income Tax: Applies to Tmi owners based on earnings.
- More info: Finnish Tax Administration www.vero.fi
5. Legal Documents and Compliance
Ensure you have the following documents:
- Business Registration Certificate
- Articles of Association (for Oy, ry companies)
- Partnership Agreement (if applicable)
- Employment Contracts (if hiring staff)
- Insurance (Mandatory for employers)
6. Business Support and Networking
Starting a business can be challenging, but various organizations offer support:
- NewCo Helsinki: Free business advisory services. www.newcohelsinki.fi
- ELY Centers: Training and financial aid for entrepreneurs. www.ely-keskus.fi
- Chambers of Commerce: Networking and legal support.
7. Setting Up a Business Bank Account
Opening a separate business account is essential for tracking finances. Major banks offering business accounts include:
- Nordea: www.nordea.fi
- OP Bank: www.op.fi
- Danske Bank: www.danskebank.fi
8. Hiring Employees & Payroll System
If you plan to hire staff, follow these steps:
- Register as an employer with the Tax Administration.
- Arrange for occupational health insurance.
- Set up a pension plan through an authorized pension provider.
- Use a payroll software or outsource payroll to an accounting firm.
Final Tips for a Successful Start
- Understand Finnish business culture – Trust and transparency are crucial.
- Use digital tools – Most business operations, including tax filings, are online.
- Get professional advice – Consult legal and financial advisors to avoid costly mistakes.
By following these steps, you can successfully establish and run your business in Finland. Best of luck with your entrepreneurial journey!