How much Tax will I pay?

[Rosamunda]

Yes, but nobody has really got the point. At the moment, I can't vote in parliamentary elections ANYWHERE. That is wrong.

As regards the military service issue which seems to hit a nerve, at no point did I encourage my kids or even suggest to them that they should opt out of military service and send back their Finnish ID. (BTW I know dual-citizenship families that have done precisely that.) When I came to Finland I was already too old to do military service myself (and - to be realistic about this, there aren't that many Finnish women who do military service). The elder two both did a full year and got the extra stripe and the youngest may well be in for more than a year since he is going to the combat engineers (pioneeri). Apart from producing reservists for the Finnish army, paying taxes, and keeping myself generally healthy and in work, I'd be interested to know what other obligations I am unable to fulfill that would otherwise entitle me to vote.

[Upphew]

Yes, but nobody has really got the point. At the moment, I can't vote in parliamentary elections ANYWHERE. That is wrong.

True, I missed your point. If you were Finn you wouldn't have that problem. Every Finn has right to vote in our parliamentary elections, regardless where s/he lives.

As regards the military service issue which seems to hit a nerve, at no point did I encourage my kids or even suggest to them that they should opt out of military service and send back their Finnish ID. (BTW I know dual-citizenship families that have done precisely that.) When I came to Finland I was already too old to do military service myself (and - to be realistic about this, there aren't that many Finnish women who do military service). The elder two both did a full year and got the extra stripe and the youngest may well be in for more than a year since he is going to the combat engineers (pioneeri). Apart from producing reservists for the Finnish army, paying taxes, and keeping myself generally healthy and in work, I'd be interested to know what other obligations I am unable to fulfill that would otherwise entitle me to vote.

Military service can be a touchy stuff now as our peace loving neighbour seems to own even the western hockey referees

[Rip]

Rip, if a well-paid employee like Roger who earns more than he spends has to pay more that might of course not affect domestic demand. The problem is only at the average and low incomes.

= only the clear majority of people.

A more reasonable option for the government to save money (which they could use to lower costs for companies) would of course be to reverse the recent rule change that entitled spouses of people with high income (like Rogers wife) to unemployment benefits.

It wasn't only high income, basically anybody earning (or owning) enough not to qualify for "toimeentulotuki". Reversing it would save (directly) some money. Some of those savings would be lost via reduced consumption among those couples that benefit from the change but aren't really that well off. In itself the reversal would make no difference to competitiveness of Finnish export industries. THE financial problem in this country is not in the end the public sector deficit of debt but the crash of the industrial production at the end of last decade that euro has prevented us from recovering.

[Rip]

The economy says everybody should earn more than they spend or else they are in debt.

No. That is actually impossible, because your spending is actually somebody else's income and vice versa.

[betelgeuse]

The economy says everybody should earn more than they spend or else they are in debt.

No. That is actually impossible, because your spending is actually somebody else's income and vice versa.

Counter example one: If the recipient of my money is a Foundation it's no-ones income excluding the human costs of the Foundation (which can be zero).

Counter example two: I am in financial ruin but it doesn't show up in credit reports yet. I go take a out another quick loan and pay a plumber with it. Eventually I default on the loan. The plumber had income without it being the income of no-one.

It's probably possible to build theoretical model for a society where the majority saves more than they spend in absolute terms. Absolute money however is not terrible interesting since purchase power is adjusted by inflation.

[Rip]

The economy says everybody should earn more than they spend or else they are in debt.

No. That is actually impossible, because your spending is actually somebody else's income and vice versa.

Counter example one: If the recipient of my money is a Foundation it's no-ones income excluding the human costs of the Foundation (which can be zero).

? It is income for the foundation.

Counter example two: I am in financial ruin but it doesn't show up in credit reports yet. I go take a out another quick loan and pay a plumber with it. Eventually I default on the loan. The plumber had income without it being the income of no-one.

No. Your spending. You go deeper in debt. Plumber has a possibility pay back his. Possible later restructuring of debt, I believe, is not formally counted either spending or income, though there too there are two parties two the "transaction" one with plus one with minus sign.

It's probably possible to build theoretical model for a society where the majority saves more than they spend in absolute terms.

You can of course always have, at least theoretical model, possibly a practical reality, where a majority seemingly breaks a mathematical entity, as long as you have sufficiently different offsetting minority. But if you see (as long as there is no trade with Mars or Proxima Centauri) trade balance or debt data showing negative or positive net values globally, you've merely spotted a problem and uncorrected error with the statistics.

[zoeker]

Hello dear fellow forum members. I'm a bit at a loss with the vero.fi calculator here.

I've chosen Helsinki as the city of residence, no church adherence, and an estimated gross anual income of 48000 euro (4000 per month). The results I get from the calculator are the following:

Results of calculation
Basic rate 25,5
Additional rate 39,5

Please add 6.35 percentage points to arrive at your actual withholding and to work out your actual take-home pay.

What are actually basic rate and additional rate? Does additional rate include municipal tax (in the case of Helsinki 18,5%). How can I arrive at the take-home pay from the information above??

[Beep_Boop]

Always calculate for 13 months per year when inputting your salary. It's better to be on the safe side and avoid annoyance when you get a company bonus or something.

[zoeker]

Basic rate is, if your income in a year is less then or equal to 48000 then 25.5% as tax will be deducted. If your income is exceeds 48000 then either you have to make new tax card or the employer will deduct 39.5% tax from your income.
for instance your income is 49K then your tax will be, 25.5% of 48K, 39.5% of 1K.

municipal tax, tv tax, etcs are usually included in the same tax percentage.

Hello roger_roger, thank you for the reply! Are you sure about this? If 25.5% is the percentage that I should be using and municipal tax, broadcasting tax, etc. are included that would mean a pure income tax of 25.5 - 18.5 - 0.68 - (...) = less than 7%. I don't think this can be true. 7% is way too low.

You'll get one tax explanation sheet which says what portion is deducted for what.

Do you mean my future payslip? The thing is I need this information before I agree to a certain salary and sign a contract. On the one hand I'm ultimately interested in the amount that I will be able to spend after all taxes have been payed, i.e. take-home pay. On the other hand, taxation is not a thing I can change. Unfortunately my potential employers asks about the salary that I expect in gross (brutto) terms. And if I am to have an answer to that question well I have to pretty much exactly know how to calculate it.

I'm not sure what that 6.35% means, maybe they are referring to your Pension contribution, Unemployment fund contribution, health contribution, etc. which may lead upto 6.35% total.

Yes, you're right.

Always calculate for 13 months per year when inputting your salary. It's better to be on the safe side and avoid annoyance when you get a company bonus or something.

Hi adnan, I don't understand the idea behind this. Normally one's income is taxed according to a 'to-the-best-of-my-knowledge' information. Any differences in the income (e.g., from bonuses) as well as the tax deductions such as from expenses for transport to work and such are ultimately calculated and cleared on the following year. At least that was the case while I was living in Germany.

[Querfeldein]

Hello roger_roger, thank you for the reply! Are you sure about this? If 25.5% is the percentage that I should be using and municipal tax, broadcasting tax, etc. are included that would mean a pure income tax of 25.5 - 18.5 - 0.68 - (...) = less than 7%. I don't think this can be true. 7% is way too low.

The municipal taxes are in addition to your federal income tax. Your total tax (federal + municipal) is going to be somewhere in the region of 40-45%, depending on the municipality. And you add the pension and unemployment insurance contribution on top of that.

[zoeker]

Hello roger_roger, thank you for the reply! Are you sure about this? If 25.5% is the percentage that I should be using and municipal tax, broadcasting tax, etc. are included that would mean a pure income tax of 25.5 - 18.5 - 0.68 - (...) = less than 7%. I don't think this can be true. 7% is way too low.

The municipal taxes are in addition to your federal income tax. Your total tax (federal + municipal) is going to be somewhere in the region of 40-45%, depending on the municipality. And you add the pension and unemployment insurance contribution on top of that.

Hello Querfeldein, thank you for the reply. Your calculations however now contradict the example that roger_roger has given earlier:

I have a bit of a WTF

Salary 4300
Tax 1400
Take home 2700

According to what you're saying for a take-home pay of 2700 in Helsinki and a total tax rate of ~26% + 18.5% + 6.35% = 50.85% the gross salary should be around 5500. That's quite a difference compared to the 4300 in the example.

[betelgeuse]

Basic rate is, if your income in a year is less then or equal to 48000 then 25.5% as tax will be deducted. If your income is exceeds 48000 then either you have to make new tax card or the employer will deduct 39.5% tax from your income.
for instance your income is 49K then your tax will be, 25.5% of 48K, 39.5% of 1K.

municipal tax, tv tax, etcs are usually included in the same tax percentage.

Hello roger_roger, thank you for the reply! Are you sure about this? If 25.5% is the percentage that I should be using and municipal tax, broadcasting tax, etc. are included that would mean a pure income tax of 25.5 - 18.5 - 0.68 - (...) = less than 7%. I don't think this can be true. 7% is way too low.

7% is not low. In Finland most services are provided by the municipality so tax money also needs to go to them. The biggest source of income for the state is value added tax:

https://www.veronmaksajat.fi/luvut/Tila ... -ja-menot/

Here you can see that you don't pay any income tax to the state for income below 16500:

http://www.vero.fi/fi-FI/Syventavat_ver ... 015(35390)

You'll get one tax explanation sheet which says what portion is deducted for what.

Do you mean my future payslip? The thing is I need this information before I agree to a certain salary and sign a contract. On the one hand I'm ultimately interested in the amount that I will be able to spend after all taxes have been payed, i.e. take-home pay. On the other hand, taxation is not a thing I can change. Unfortunately my potential employers asks about the salary that I expect in gross (brutto) terms. And if I am to have an answer to that question well I have to pretty much exactly know how to calculate it.

Use basic rate + 6,35. Go to the final page and it will give you a monthly limit. Additional rate is used when you go above this monthly limit. In reality for your purposes the basic and additional percentages don't matter. They are just for withholding purposes. You can see the exact taxation percentage by dividing "Total taxes and tax-like charges for the entire year" with "Future income" (this works when "Gross income from January 1st" is set to zero). Add the 6,35% and you end up with take home pay.

Always calculate for 13 months per year when inputting your salary. It's better to be on the safe side and avoid annoyance when you get a company bonus or something.

Hi adnan, I don't understand the idea behind this. Normally one's income is taxed according to a 'to-the-best-of-my-knowledge' information. Any differences in the income (e.g., from bonuses) as well as the tax deductions such as from expenses for transport to work and such are ultimately calculated and cleared on the following year. At least that was the case while I was living in Germany.

It works the same in Finland. Adnan is giving you an unrelated advice on how to rather run a surplus in withholding. I use the opposite strategy of minimizing withholding since it's an interest free loan from the state. Most people just don't have the skills to be prepare for eventually paying the taxes owed.

[Beep_Boop]

Adnan is giving you an unrelated advice on how to rather run a surplus in withholding. I use the opposite strategy of minimizing withholding since it's an interest free loan from the state. Most people just don't have the skills to be prepare for eventually paying the taxes owed.

Indeed. I personally just find it inconvenient to go through the process of paying the taxes back. I like the way it's done automatically and how the surplus is returned to my checking account.
I've known a few people underestimate for the exact reason you suggested (interest-free loan). For my particular case, I have 0 advantage if I pay the money late.

[betelgeuse]

Adnan is giving you an unrelated advice on how to rather run a surplus in withholding. I use the opposite strategy of minimizing withholding since it's an interest free loan from the state. Most people just don't have the skills to be prepare for eventually paying the taxes owed.

Indeed. I personally just find it inconvenient to go through the process of paying the taxes back. I like the way it's done automatically and how the surplus is returned to my checking account.
I've known a few people underestimate for the exact reason you suggested (interest-free loan). For my particular case, I have 0 advantage if I pay the money late.

I don't underestimate since I don't want to submit false information. It just has happened that due to varying circumstances the tax cards sent by Vero have had lower limits.

[Beep_Boop]

I don't underestimate since I don't want to submit false information. It just has happened that due to varying circumstances the tax cards sent by Vero have had lower limits.

*sigh* Did you really have to phrase it like that, just for ahole points? Well, congrats.. you gained some points.

Let me play your game a bit: So you basically intentionally withhold the correct information by intentionally not submitting corrections to Vero's low numbers? There's no ambiguity here about your intentions. You said you that you "use the opposite strategy of minimizing withholding ".
So, it's clear here. You're intentionally letting Vero have incorrect numbers for the sole purpose having the equivalent of an interest-free loan. Of course, this equates to more effort and work put by the tax administration to work on collecting the extra unpaid taxes from you (sending the letter, making sure you paid, and all the human effort associated with that).

This boils down to you wasting the public's money. Let's try a different game this time; the "let's be nice to people who are being nice to us" game.