Rarrr, upcoming immigrant

[riku2]

The 7% is in addition to income tax and local tax also. I suppose you've already researched that there is national + local tax on your income and the local tax varies a little depending on where you live (only by a few % though). The tax rate is massively higher than in the UK as you might expect of any nordic country.

tax year the same? I think some more research is needed. In the UK 6 April - 5 April . In finland 1st january -> 31 dec!
When you move does make a difference since if you time it right, since for both the UK and Finland you will be taxed based on just what you earned in that country.

So leave UK on 1st september 2015 means your 2015-2016 UK tax is based on April-August income (so quite a low amount since only 5 months income for the whole "year").
Once in finland your 2015 income is only from 1st september - 31 Dec (4 months). And again not much of an income (4 months for the year) to pay finnish tax on.
So in both cases you benefit a lot from the tax free allowance in both countries.
Compare that with moving on 1st january 2016. You'd pay finnish tax on a whole years income and UK tax on 9months income), so not much benefit from tax free allowances in either case (no extra benefit from finland, only 3months extra from UK).

[lupine]

Whoops, you're right; you file your tax return by March/April in .fi, but the tax year ends before that. I'm not convinced that the total tax rate is *that* much higher in .fi than .uk (spreadsheet soon), but yeah, if you're moving for tax avoidance purposes, the nordics aren't exactly going to be your first choice . Bulgaria has a flat 10% tax... such people ought to go there instead.

The tax allowance dodge is extraordinary, I'd just assumed tax allowances would be pro-rata.

[tjawatts]

How did you get the tax years being the same? UK tax year is April isnt it? Finnish tax year is calendar year.

T

[tjawatts]

Ooops, didnt read page 2.

BTW if you leave with no intention of returning then your residence changes then.

T

[snorlonikins]

The EHIC is valid for 3 month and you can apply for residency after 3 months. Does that qualify as proof that you're not returning in the immediate future to the UK?

[suomynona.yllatot]

Hi!

I remember an acquaintance of mine, who did some calculations, on a figure of £100000 in the UK (or a similar salary of about €121000, in Finland) ultimately led a difference of only about 300 EUR in the take home. He said that when taking into account crèche (childrens daycare), and schooling costs, it was cheaper in Finland than the UK.

Question: Is that correct?

I wanted to be sure before I wrote this here, so a quick Google search also seems to suggest the same. E.g.

In the UK
Year/ Month/ Week

Gross Wage £100,000 £8,333 £1,923
Taxable Wage £90,560 £7,547 £1,742
Tax Paid £29,822 £2,485 £574
Tax Free Allowance £9,440 £787 £182
National Insurance £5,215 £435 £100
Take-home pay £64,963 £5,414 £1,249
Student Loan £0 £0 £0
Pension £0 £0 £0
Pension HMRC £0 £0 £0

So, the take home would be £5,414 or about ~6,571.03 EUR; and in Finland:

Finland
Tulevat tulot yhteensä 121000,00
Koko vuoden verot ja maksut yhteensä 46292,11
Perusprosentti 38,5

So, the take home in Finland was about €121000/12kk = 10083 €; 38% * 10083 € = 6201,045. Is that really so? I thought taxes were much lower in the UK?

[betelgeuse]

So, the take home in Finland was about €121000/12kk = 10083 €; 38% * 10083 € = 6201,045. Is that really so? I thought taxes were much lower in the UK?

I don't know the UK system to comment on the payments. However, make sure you get all the payments correctly. For example in Finland when the employer pays salaries they have to at the same time pay over 20% of pension payments. If this is included in the UK 100K salary then you are are not comparing the same salaries. Also remember that on top of the veto.fi calculator you have to pay insurance payments so the withholding percent is in reality higher than 38,5.

[suomynona.yllatot]

For example in Finland when the employer pays salaries they have to at the same time pay over 20% of pension payments. If this is included in the UK 100K salary then you are are not comparing the same salaries. Also remember that on top of the veto.fi calculator you have to pay insurance payments so the withholding percent is in reality higher than 38,5.

<copy/paste>
Palkasta menee perusprosentin lisäksi eläkevakuutusmaksua 5,55 % ja työttömyysvakuutusmaksua 0,5 %. Jos lasket, paljonko palkasta jää käteen verojen ja maksujen jälkeen, lisää perusprosenttiin 6,05 prosenttiyksikköä.
<End of copy/paste>

<copy/paste>
Withholding also includes pension and unemployment insurance premiums amounting to 5.55% and 0.5%.
Please add 6.05 percentage points to arrive at your actual withholding and to work out your actual take-home pay.
<copy/paste>

Hmmm! Not sure what is 6.05 percentage points... or is this a simple way of saying, an additional 6.05% will be deducted? That would mean 45%... Then that is exceptionally higher!

[betelgeuse]

Hmmm! Not sure what is 6.05 percentage points... or is this a simple way of saying, an additional 6.05% will be deducted? That would mean 45%... Then that is exceptionally higher!

Yes this is simply saying to add 6.05 to 38.5 totaling 44.55%.