reduced/exempted tax rate

[nben]

Stephen Elop got a reduced taxation rate in Finland, I am planning to ask for the basis on which the reduced taxation was applied from Vero, so that I too can apply for a lower/reduced, or even exempted tax rate. Anybody wanting to co-sign the request for information? Please let me know. Thanks.

PS: yes, I am aware that the regulations allow for the 35% reduced rate ONLY if you are maximum 6 months in Finland. Not the case here, I understand.

[ajdias]

lol. Ask ahead: http://yle.fi/uutiset/elop_enjoyed_pref ... nd/6842147

[nben]

Yea, I will Wondering if there are others that are interested as well.

[Liam1]

A bit misleading - he will have paid ~41% (there is the social security insurances etc) which puts him well into the highest 10% of tax rates paid and the top 0,1% of tax payers.

I am planning to ask for the basis on which the reduced taxation was applied from Vero, so that I too can apply for a lower/reduced, or even exempted tax rate.

If you are saying that you also want this "privilege" (a flat 41% tax rate) then lucky you as it means that you have a good wage, well well above the Finnish average.

So he gets a tax break for up to 4 years for being a foreigner?- shock horror! he didn't cost Finland for 20 years education/health /child subsidy either and I am kinda guessing he won't be sticking around to collect his unemployment benefit or use Finnish health as a pensioner!

Ex Pats are always a bit of a special case. If asked to move abroad, no one is going to accept a net pay cut and normally need a bit more just to cover costs of being an expat e.g. flights to see family, extra daycare as no local network + non- financial e.g. break in social life etc. As a result, most countries offer some tax breaks (Belgium offer €25kpa of tax free allowance!). If Finland didn't, it'd lose HQ's or depts that relocate (for a parallel look at how many of the Nordic sporting elite "live" in Monaco! Tax receipts for Nordic coffers:0). Else companies would need to pay ex pats more and hence pay less corporation tax.

One thing I never get is that it always feels socially "acceptable" to criticise such tax breaks, while we all happily have or know friends / family that buy smuggled cigarettes / employ workmen on "cash" basis. The latter costs Finland far far more, but isn't greed it's "playing the game"!

[Upphew]

One thing I never get is that it always feels socially "acceptable" to criticise such tax breaks, while we all happily have or know friends / family that buy smuggled cigarettes / employ workmen on "cash" basis. The latter costs Finland far far more, but isn't greed it's "playing the game"!

Word!

[riku2]

I think Elop was under the scheme for foreign experts which has existed for many years

rules seen to be

• min 8500e/month salary
  35% flat tax (instead of state + municipal tax)
  valid for 4 years only
  must not have being a finnish tax resident for previous 5 years

There are various other tax schemes which would outrage the normal worker. Like those working for EU agencies in finland, they pay a different tax rate too and not just the arriving foreign workers but even those already living in Finland would pay a lower EU rate should they get a job there. This is not unique to finland though but applies in other EU countries also.

[network_engineer]

he didn't cost Finland for 20 years education/health /child subsidy either and I am kinda guessing he won't be sticking around to collect his unemployment benefit or use Finnish health as a pensioner!

Er, now, I am confused. By that standard, I should qualify as well!!! Come to think of it, my parents paid for my education through-and-through, and the Finnish system did not pay for my education/health/daycare etc. Hell, I even paid for my higher business education out of my own pocket!!!

This is something a lot of the Finns are really pissed off about! And me, even more so!

he won't be sticking around to collect his unemployment benefit

Wanna bet?

[Liam1]

Er, now, I am confused. By that standard, I should qualify as well!!! Come to think of it, my parents paid for my education through-and-through, and the Finnish system did not pay for my education/health/daycare etc.

Well if you mean you came as an expat and paid (using Riku's calculation on minimum tax) €36k pa in tax + €5k in social insurance maybe you could have! Oh and you have selectively quoted just one reason why this isn't an issue.

he won't be sticking around to collect his unemployment benefit

Wanna bet?

Hmmm even with an alomony, I think he may choose to be CEO of Microsoft rather than €58 / day

[network_engineer]

Well if you mean you came as an expat and paid (using Riku's calculation on minimum tax) €36k pa in tax + €5k in social insurance maybe you could have! Oh and you have selectively quoted just one reason why this isn't an issue...

???

Copy/paste from the Finnish Tax administration:

Foreign ‘key employees’ arriving in Finland for more than six months can pay a flat-rate 35-percent tax on their earned income instead of progressive income tax. The 35-percent rate is applied to:

Persons working as teachers or researchers in an institution of higher education in Finland; or
Persons whose monthly cash salary is at least €5,800 throughout their visit in Finland and whose duties in the service of a Finnish employer require special skills


//

Did I miss something here?

Special skills? In that case, I believe both the OP, and other outraged Finns and foreigners alike, including me have special skills. After all, how much skill does it take to run a company aground???

That being said, I do admit, that I don't necessarily see S.E. as the mischief maker, he sets some conditions for his employment. The bigger people that need to be investigated are the ones who set up the company to fall, i.e. the board and Nokia management who asked him to stall and sell the company cheap. Read the news.

rather than €58 / day

Even if he got a 100.000 EUR / day, and 58 EUR in addition = 100.058/day!

[Liam1]

Did I miss something here?

Special skills? In that case, I believe both the OP, and other outraged Finns and foreigners alike, including me have special skills

Are we violently agreeing? You and the OP were lamenting the fact that you didn't get this, while Elop did. I was saying that you may have both been eligible - you pasted to prove that maybe you were!!! The point is that the expert deal is to pay a flat rate at 35% NOT a discount on what a Finn pays. So most experts miss out on this because it just isn't worth it (their normal tax card would be say 30% so why pay 35%? - the €8500 / month is I'm guessing the wage needed to make it worthwhile)

Even if he got a 100.000 EUR / day, and 58 EUR in addition = 100.058/day!

Again maybe I am being dim, but you cannot claim unemployment if you have a job! So your example doesn't add up. It's 100,000 (job) or 58 (unemployment) but not both. Others may try but if you are on Microsoft's board, think may get found out!!!

[nben]

You and the OP were lamenting the fact that you didn't get this, while Elop did

No, the basis for this exemption is quite clear: For over 6 months, you must have special skills in a special occupation. My point is this: if the tax office can take such a lax view on what constitutes "special skills", and start giving reductions in tax percentages, I believe a lot of people are also equally able to qualify. It is the randomness of the way "special skills" are applied. Finally, if they can be random, all I want to do, is ask the criteria for their random behavior, so others can use it as well!

Yes, this does irritate me. My husband has often payed over 35%, with a salary nowhere close the SE. Of course, you are free to rejoice at the exemption given, what a lot of the Finns, as well people like me consider unfair.

And no, AFAIK, you can hit 35 at a lower salary level, around 90K.

Again maybe I am being dim,

correct

you cannot claim unemployment if you have a job! So your example doesn't add up. It's 100,000 (job) or 58 (unemployment) but not both. Others may try but if you are on Microsoft's board, think may get found out!!!

You cannot be employed in Finland. There are many that are now retired, and have full-time jobs, we know one couple in Brazil, husband, 68 years, wife, 64, both still working in various boards, and also draw pension from Finland.

[Upphew]

you cannot claim unemployment if you have a job! So your example doesn't add up. It's 100,000 (job) or 58 (unemployment) but not both. Others may try but if you are on Microsoft's board, think may get found out!!!

You cannot be employed in Finland. There are many that are now retired, and have full-time jobs, we know one couple in Brazil, husband, 68 years, wife, 64, both still working in various boards, and also draw pension from Finland.

Unemployment isn't retirement.

[zax]

As much as I loathe Elop and his actions, at least he paid *something*.

The wholesale (mis)use of work visas to import non-residents while they learn, make Finnish workers redundant and then leave is a far bigger issue with greater long term cost to the country both in tax revenue and elsewhere.

[Liam1]

Again maybe I am being dim,
correct
you cannot claim unemployment if you have a job! So your example doesn't add up. It's 100,000 (job) or 58 (unemployment) but not both. Others may try but if you are on Microsoft's board, think may get found out!!!

You cannot be employed in Finland. There are many that are now retired, and have full-time jobs

Oh the irony - you insult me on the one area that it is not opinion but fact - you are wrong - plain and simple.

As to the rest

And no, AFAIK, you can hit 35 at a lower salary level, around 90K

- Oh only 90k? Thanks for proving my point that most don't use this as an average 90k (you cannot change systems in this period) is so rarely seen in Finland.

you must have special skills in a special occupation. My point is this: if the tax office can take such a lax view

Are you seriously arguing CEO Nokia (Finland's largest and only truly global company) is not an expert role? I fear that you are letting your prejudice of how well you think he did, cloud your judgement as to whether the job itself requires an expert.

However to correct you, it is not a discount - it is a flat rate only worthwhile above 90kpa- so other than your husband sometimes, SE and a select small group of others, noone will want it. Indeed the embeded article states most that apply, get it. To me that goes without saying, because whilst you may not see these people as experts, a Finnish company willing to risk bringing a foreigner here and pay them 90kpa must think this. Therefore you have not explained who this is unfair against - do you know people who have been refused this? If you mean high earning Finns, they also have the right to find a job at the equal or better conditions (all countries do this) if they decide to become ex pats. If you are raging against every country for doing it, good luck in changing the world.

[nben]

Oh the irony - you insult me

Nope, I did not mean / don't mean to be insulting.

one area that it is not opinion but fact

We were talking different things, you were talking about unemployment, whereas I was talking about being retired and still being employed. But that being said, I know a Chinese lady, claiming unemployment, traveled back to China, is employed with a telecom company there, however, delivers the software testing from home, gets paid, and is drawing unemployment as well.

90K is VERY common, about 7,5K / PM. Perhaps, not in a purely technical coding/development role. But even in that role, a specialist today can easily hit 60K.

Nokia (Finland's largest and only truly global company)

Largest? I must have missed something! Whether you talk about the revenue to state, or employment, Nokia ceased to be a large employer, quite some time ago.

Only truly global? OK, if you mean that they have more retail customer outreach, then yes. Perhaps, even if you mean the largest employer by advanced technical competencies, perhaps yes. Won't disagree, don't have enough facts on this.

CEO Nokia (Finland's largest and only truly global company) is not an expert role

1. The CEO position *may* be an expert role, but ONLY when that role accomplishes something, or requires skills to accomplish something. Just about anybody could have under-driven the company, sank it, and sold it cheap - why not a Finnish manager to do that? At least he would have paid taxes at par.

2. Hence, my argument that he does NOT fit into the special category to benefit from the flat rate.

3. Hence At the salary level, he should have been paying a lot more, some people have paid upto 46%, while earning far less than what he got.

How hard is it to see this point? The Finns seem to see it easy enough. But I agree, I won't necessarily see SE at fault, it is the failure of the policy makers on this.