Finland has a strong economy, a highly qualified workforce, and an encouraging startup ecosystem. This makes it a desirable location for entrepreneurs.
A few legal and government processes must be followed. But how to start up a new business in Finland needs a thorough plan.
So, if you’re thinking about launching a business. From selecting an organization structure to having registered your firm. May this guide help you every step of the way?
Decide on a Corporate Structure
- Private Entrepreneur or Toiminimi
Perfect for independent contractors, consultants, or corporate owners. Although it is easy to set up, the owner bears personal responsibility for the obligations of the organization.
- Limited Liability Company or Osakeyhtiö, Oy
A well-liked option for small and medium-sized enterprises. Because the liability of the business is capped at its capital, it is a safer choice for corporate owners.
- General Partnership or Avoin yhtiö,
It’s appropriate for companies with two or more employees and equal responsibilities.
- Limited Partnership or Kommandiittiyhtiö
This consists of one quiet partner with limited responsibility and at least a single general partnership with unlimited liability.
- Public Limited Corporations or Julkinen osakeyhtiö, Oyj
Larger businesses with publicly traded shares. The standards for this construction are more stringent.
- Co-operative or Osuuskunta
Ideal for companies run and owned by several people, including cooperatives that sell goods or services.
Register the Name of Your Establishment
You must select and obtain a company name first before fully registering your firm. The name ought to be original and not currently being used by another Finnish industry.The website of the Finnish PRH – click https://www.prh.fi/en/index.html, allows you to verify whether a business name is available.
Ensure that the name fits the nature of your company and complies with Finland’s naming regulations. It shouldn’t use deceptive language or allude to a business-unrelated action.
Register with the Appropriate Authorities.
- Pay the registration fee and turn in the necessary paperwork.
- You are required to register for VAT if your yearly turnover is above €20,000 (2025). The Finnish Tax Administration or the PRH can be used for this.
- Sign up for the Employer Register if you want to hire staff.
- Prepayment Register – This is required for companies that will be sending out bills to clients. Your clients won’t have to deduct taxes from your payments if you register.
Create a Corporate Bank Account
You will require an independent bank account for the firm after it has been registered. For bookkeeping and tax purposes, it is crucial to keep personal and corporate money distinct. The majority of Finnish banks need:
- Your company’s registration paperwork serves as proof of registration.
- A current passport or ID.
- Minutes of board meetings for limited companies. If you are forming a limited liability organization, this is relevant.
Safe Funding and Financing
Finland provides a range of financing alternatives for start-up companies. This includes loans, grants, and private investment. For growth, working capital, or equipment acquisitions, bank or conventional loans might be utilized.
Recognize Taxes
An essential aspect of managing a corporation in Finland is navigating the tax system. Important taxes to be mindful of are:
- Corporation Income Tax: Finland has a 20% corporation tax rate.
- Value Added Tax: Some goods and services are subject to reduced VAT rates; however, the standard VAT rate is 25.5%.
- Employer Contributions: You are required to provide social security and retirement savings contributions if you recruit staff.
Utilize Accounting Software for Financial Management
Maintaining conformity to Finnish accounting standards. Also, making wise company decisions depends on keeping an eye on your accounts. This procedure may be streamlined with accounting software, which makes it simpler to:
- Monitor earnings and outlays: Automated monitoring aids in maintaining cash flow.
- Create invoices: Expert invoicing tools guarantee that customers will pay on time.
- Get ready for tax filings: Makes VAT filing and other tax responsibilities easier.
- Banking integration: Makes a connection to your company’s bank account to facilitate simple reconciliation.
- Track financial performance: Offers information via dashboards and financial reports.
Observe Employment Laws
Be mindful of Finland’s employment laws. These are renowned for being employee-friendly if you want to hire employees. Important things to think about are:
- Employment contracts: Must be in writing and adhere to Finnish labor regulations.
Laws regulate hours of operation and overtime to maintain a healthy work-life balance. - Social Security Funds: Owners must make payments to the pension and social security accounts of their workers.
- Standards for health and safety: Verify that the workplace complies with legal requirements.
Think About Business Insurance
Insurance is strongly advised even if it’s not usually required. You could require the following types of insurance:
- Potential lawsuits against your company are covered by general liability insurance.
- Property insurance: Guards the assets of your company.
- Professional liability insurance is necessary for companies that offer services or advice.
- Employee insurance: You are required by law to offer workers’ compensation insurance if you employ people.
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