Moving to Finland, but keeping my US-based job

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jperickson
Posts: 2
Joined: Mon Dec 07, 2020 4:58 pm

Moving to Finland, but keeping my US-based job

Post by jperickson » Mon Dec 07, 2020 6:41 pm

Hello - I will be moving to Finland in 2021 from the US on a residence permit (family-based, not work-based). I want to keep working for my company which is based in the US, but as a contractor. I've read a lot about what to do in this situation, including on this site, but I still have a few questions as many threads don't apply exactly to my situation. I would greatly appreciate any information and opinions about how to proceed. Here are my questions, but if you are aware of any other "gotchas" I would appreciate your thoughts. Thank you!

1. I believe that registering a tmi (vs an OY or as a "freelancer") is the right decision here because I only plan to only have one client (for now), namely this US-based company. Does this sound sensible?

2. Do I need to charge VAT on my invoices to this US client?

3. I heard a rumor from a Finn that having registered a tmi in the past sometimes makes it hard to get Kela benefits even years later because you are/were "an entrepreneur." Is there any truth to this?

4. I have read on Vero's website that if you are staying in Finland for less than 6 months, that you do not owe tax to Finland, but other sources imply that it's more about your _intentions_. Since I intend to stay in Finland indefinitely, do I owe tax to Finland on day 1? Or is this question not even relevant because I am registering a tmi and therefore owe tax immediately regardless of residence time and intentions?

5. Any other advice or alternative setups I may not have considered for this type of situation?



Moving to Finland, but keeping my US-based job

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betelgeuse
Posts: 3717
Joined: Thu Aug 29, 2013 1:24 am

Re: Moving to Finland, but keeping my US-based job

Post by betelgeuse » Mon Dec 07, 2020 8:30 pm

jperickson wrote:
Mon Dec 07, 2020 6:41 pm
Hello - I will be moving to Finland in 2021 from the US on a residence permit (family-based, not work-based). I want to keep working for my company which is based in the US, but as a contractor.
jperickson wrote:
Mon Dec 07, 2020 6:41 pm
1. I believe that registering a tmi (vs an OY or as a "freelancer") is the right decision here because I only plan to only have one client (for now), namely this US-based company. Does this sound sensible?
Hard to say. OY is more paperwork but better tax opportunities.
jperickson wrote:
Mon Dec 07, 2020 6:41 pm
2. Do I need to charge VAT on my invoices to this US client?
No. You would still register to reclaim VAT on your costs.
jperickson wrote:
Mon Dec 07, 2020 6:41 pm
3. I heard a rumor from a Finn that having registered a tmi in the past sometimes makes it hard to get Kela benefits even years later because you are/were "an entrepreneur." Is there any truth to this?
For unemployment you will get better benefits from a fund.

https://yrittajakassa.fi

It's harder for an entrepreneur but possible.

http://www.te-palvelut.fi/te/en/jobseek ... index.html

betelgeuse
Posts: 3717
Joined: Thu Aug 29, 2013 1:24 am

Re: Moving to Finland, but keeping my US-based job

Post by betelgeuse » Mon Dec 07, 2020 8:34 pm

jperickson wrote:
Mon Dec 07, 2020 6:41 pm
4. I have read on Vero's website that if you are staying in Finland for less than 6 months, that you do not owe tax to Finland, but other sources imply that it's more about your _intentions_. Since I intend to stay in Finland indefinitely, do I owe tax to Finland on day 1? Or is this question not even relevant because I am registering a tmi and therefore owe tax immediately regardless of residence time and intentions?
"If an individual has his or her permanent home in Finland, they are treated as a resident. An individual who stays in Finland for a continuous period of more than six months is also treated as a resident."

https://www.vero.fi/en/detailed-guidanc ... residency/

If you are also a US tax resident, tax treaty provisions decide where taxes are paid.

FinlandGirl
Posts: 558
Joined: Sat Nov 09, 2019 10:43 am

Re: Moving to Finland, but keeping my US-based job

Post by FinlandGirl » Mon Dec 07, 2020 8:40 pm

betelgeuse wrote:
Mon Dec 07, 2020 8:30 pm
jperickson wrote:
Mon Dec 07, 2020 6:41 pm

3. I heard a rumor from a Finn that having registered a tmi in the past sometimes makes it hard to get Kela benefits even years later because you are/were "an entrepreneur." Is there any truth to this?
For unemployment you will get better benefits from a fund.

https://yrittajakassa.fi

It's harder for an entrepreneur but possible.

http://www.te-palvelut.fi/te/en/jobseek ... index.html
Income-based unemployment benefits are not available the way they are for employees.
If you just close down your business you are entitled to the same Kela benefits at least at the level as someone without previous income.
Last edited by FinlandGirl on Mon Dec 07, 2020 8:42 pm, edited 1 time in total.

betelgeuse
Posts: 3717
Joined: Thu Aug 29, 2013 1:24 am

Re: Moving to Finland, but keeping my US-based job

Post by betelgeuse » Mon Dec 07, 2020 8:42 pm

jperickson wrote:
Mon Dec 07, 2020 6:41 pm
3. I heard a rumor from a Finn that having registered a tmi in the past sometimes makes it hard to get Kela benefits even years later because you are/were "an entrepreneur." Is there any truth to this?
The years later part is hogwash. If you take the steps to end the entrepreneur status, it will not come back to haunt you.
jperickson wrote:
Mon Dec 07, 2020 6:41 pm
5. Any other advice or alternative setups I may not have considered for this type of situation?
Educate yourself on how YEL insurance works.

FinlandGirl
Posts: 558
Joined: Sat Nov 09, 2019 10:43 am

Re: Moving to Finland, but keeping my US-based job

Post by FinlandGirl » Mon Dec 07, 2020 8:47 pm

jperickson wrote:
Mon Dec 07, 2020 6:41 pm
5. Any other advice
https://www.uusyrityskeskus.fi/in-english/

Read the guide, and make an appointment with an advisor in the city where you will be living.

betelgeuse
Posts: 3717
Joined: Thu Aug 29, 2013 1:24 am

Re: Moving to Finland, but keeping my US-based job

Post by betelgeuse » Mon Dec 07, 2020 8:47 pm

FinlandGirl wrote:
Mon Dec 07, 2020 8:40 pm
Income-based unemployment benefits are not available the way they are for employees.
If you just close down your business you are entitled to the normal basic benefits at least at the level as someone without previous income.
Not true. If the company does not have significant assets, you will get earnings related unemployment benefit immediately after shutdown. Otherwise, the assets will delay it.

https://yrittajakassa.fi/tietopankki/ta ... -jaksotus/

Partly because entrepreneurs can influence their eligibility themselves, the required membership period is longer and the fees higher.

FinlandGirl
Posts: 558
Joined: Sat Nov 09, 2019 10:43 am

Re: Moving to Finland, but keeping my US-based job

Post by FinlandGirl » Mon Dec 07, 2020 8:50 pm

betelgeuse wrote:
Mon Dec 07, 2020 8:47 pm
FinlandGirl wrote:
Mon Dec 07, 2020 8:40 pm
Income-based unemployment benefits are not available the way they are for employees.
If you just close down your business you are entitled to the normal basic benefits at least at the level as someone without previous income.
Not true. If the company does not have significant assets, you will get earnings related unemployment benefit immediately after shutdown. Otherwise, the assets will delay it.

https://yrittajakassa.fi/tietopankki/ta ... -jaksotus/

Partly because entrepreneurs can influence their eligibility themselves, the required membership period is longer and the fees higher.
I've marked in bold where I said the same.

The question was about Kela benefits, which are not earnings related.

jperickson
Posts: 2
Joined: Mon Dec 07, 2020 4:58 pm

Re: Moving to Finland, but keeping my US-based job

Post by jperickson » Sun Dec 13, 2020 9:06 pm

Thank you both for your replies. This is very useful information. One other question I have that I will post here in case either of you knows (before I start a new thread): What exactly is the difference/benefits of a tmi versus just having my US-based client pay me directly and I count it as income, no tmi or OY registered? Is this even an option in Finland? Is it because of VAT registration and YEL insurance?
Last edited by jperickson on Sun Dec 13, 2020 9:07 pm, edited 1 time in total.


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