News |

Finland’s richest get the most out of domestic expenses tax deductions

New data from the Finnish Tax Administration show that Finland’s wealthiest residents received the highest tax credits on domestic expenses in 2013. While 97 percent of the nearly 400,000 householders who claimed the tax deduction received it, the figures show that the largest deductions went to the country’s poshest addresses.

Domestic expense credit 2013
Domestic expenses credits claimed in municipalities in 2013. Image: Yle Uutisgrafiikka

According to the Finnish Tax Administration in 2013 the country’s wealthiest municipalities pocketed the largest tax deductions for domestic expenses arising from items such as minor home renovations.

The figures show that residents of Kauniainen, an upscale Helsinki suburb, on average of claimed a tax credit of 1,182 euros for work done in their homes. Kauniainen is also home to many of Finland’s highest-earning residents, according to 2013 income data from Statistics Finland.

In general the largest domestic expenses tax deductions were claimed in western Finland, particularly in small municipalities in the Åland islands, such as Vårdö and Saltvik.

Residents of Enontekiö in Lapland claimed the smallest sums for home fixes, on average 553 euros – that’s less than half of claims from householders in Kauniainen. In general people living in northern and eastern Finland were inclined to claim very modest tax reliefs.

Throughout the country the average tax credit came in at 848 euros in 2013, an increase of four percent on claims in the previous year. Altogether 390,000 householders took advantage of the domestic expenses tax credit.

Tax officials accepted 97 percent of those claims, which represented a total of 325 million euros. The majority of deductions were related to home maintenance and basic improvements – some 77 percent.

2011 turned out to be a record year for the tax credits, which amounted to 476 million euros. However at that time the deductible amount was 60 percent of VAT-inclusive costs. Nowadays it is 45 percent of the VAT-inclusive total and householders can claim no more than 2,400 euros.

Juha Sipilä’s new government appears to favour the current system. The government programme calls for an increase in the level of renovation expenses and those providing elder care services will also be eligible for the tax relief.

Latest in: News

Headlines

Our picks

Latest

Muualla Yle.fi:ssä