Contractors in Finland can be set up in 2 ways, Employed and Self Employed.
Contractors should be engaged in Finland as employees with income fully processed through the local payroll. This is the most compliant type of engagement in country.
Self-employment may be possible for contractors but this must be considered carefully. This is available to truly independent contractors who will typically provide services as private entrepreneurs. To qualify as a self-employed person, the typical criteria will be economic independence; freedom to determine his/her own activities, working hours and place of work; use their own equipment; hire assistants or arrange substitutes.
Tax year – The tax year is the calendar year for individuals
Immigration – Nationals of the other Nordic countries (Denmark, Iceland, Norway and Sweden) can work in Finland without any restrictions. They do not need a residence permit; however they must register with the local register office if they stay in Finland for longer than three months. Nationals of other EU/EEA and Switzerland must register their residence with the Finnish Immigration Service if their stay lasts more than three months.
Workr Fees – €575 per month plus €350 set up fee. This applied to both the employed and self-employed solutions
Registration – Workr will arrange statutory insurance and registration of the employee with the various funds. We also send a notification to the Tax Administration authorities about the engagement of the employee.
Contract – Open-ended contracts are the norm and a fixed-term contract can be used only if there is a justified reason for doing so.
A fixed-term contract can have up to three successive extensions (so four contracts issued in total). Each contract (and each subsequent extension) must last at least three months, with a maximum total duration of two years (that is the combined duration of the original contract plus all extensions).
Employers social security contributions are approximately 30% of the gross salary with no income ceiling. Some other contributions are made to 5 different government offices all with different percentages of contribution.
Employees social security contributions are 10%
Tax – Income tax which is progressive and ranges from 6% to 31.25%
Benefits – Holidays: 30 days per year Public holidays: 10 days (time off paid when fall on a working day)
Holiday bonuses:depends on CBA but is normally provided typically around 50% of holiday pay (so that is 1.5 normal pay during annual leave).