Starting a company in Finland is often seen as a straightforward process. The country is known for its stability, transparent regulations and well-functioning public authorities. Yet for international founders, the real challenge is not company registration itself, but getting the tax registrations, structure and compliance foundations right from day one.
In 2026, Finland continues to refine its tax and corporate framework, closing loopholes and increasing expectations around proper reporting and structuring. This makes early decisions more important than ever, especially for founders who plan to operate remotely or grow across borders.
This guide explains what international entrepreneurs need to understand when starting a company in Finland, with a particular focus on tax registration and long-term compliance.
Why Finland is an attractive country to start a business
Finland remains one of the most reliable business environments in the European Union. Its political and economic stability, strong legal system and predictable tax framework make it appealing for founders looking for long-term certainty.
From an operational perspective, Finland offers full access to the EU single market, advanced digital public services and a high level of transparency when dealing with authorities. Most registrations and filings can be handled electronically, which is particularly important for non-resident founders managing their companies remotely.
At the same time, Finland is not a “light-touch” jurisdiction. The rules are clear, but they are enforced. This balance between openness and discipline is what attracts serious entrepreneurs—and why proper setup matters.
Start a company in Finland: registration basics founders must understand
To start a company in Finland, founders must complete registration with two key authorities: the Finnish Patent and Registration Office (PRH) and the Finnish Tax Administration (Verohallinto).
The cornerstone of the process is obtaining a Business ID (Y-tunnus). This identifier is used across all official systems, including tax reporting, VAT, payroll and banking. Without it, a company cannot operate legally.
Company registration in Finland is often perceived as administrative paperwork, but in practice it is the moment when many long-term tax and compliance obligations are defined. Choices made during registration—such as company form, activities and tax registrations directly affect how the business will be taxed and reported going forward.
This is why experienced founders treat registration not as a formality, but as a strategic step.
Tax registration in Finland: what every new company must handle
Tax registration is one of the most critical parts of starting a company in Finland, and also one of the most commonly underestimated.
New companies may need to register for several tax purposes, depending on their activities. This typically includes VAT registration, employer registration and prepayment tax (ennakkovero).
VAT registration is required once taxable turnover exceeds the applicable threshold, but in many cross-border or B2B situations, registration may be necessary earlier. Employer registration becomes mandatory as soon as the company pays salaries, even to a single employee or director. Prepayment tax determines how corporate income tax is paid throughout the year and should be adjusted as the business develops.
In addition, companies that pay salaries must report income to the Incomes Register (Tulorekisteri). This reporting obligation applies in real time and is strictly monitored.
Late or incorrect tax registration often leads to avoidable consequences, such as reassessments, penalties or cash flow issues. For international founders unfamiliar with Finnish rules, these problems usually arise not because the law is unclear, but because registration decisions were made without proper guidance.
This is where professional tax registration support adds real value at the start.
Choosing the right company structure in Finland from the start
Most international founders choose to establish a Finnish limited liability company (Osakeyhtiö or Oy). It is flexible, widely recognised and suitable for both operating businesses and holding structures.
However, structure goes beyond choosing “Oy” on a form. Shareholder arrangements, share classes, dividend planning and future exit considerations all influence how the company will be taxed over time.
Recent legislative changes in Finland underline this point. Amendments to the taxation of share exchanges and dividends, taking effect for the 2026 tax year, are designed to prevent artificial tax optimisation. These rules demonstrate that decisions made early, sometimes years before dividends are paid or shares are sold, can have significant tax consequences later.
Founders who think ahead at incorporation stage are far better positioned than those who try to restructure after the business has grown.
Common mistakes international founders make when starting a company in Finland
In practice, the same issues appear repeatedly among foreign-owned Finnish companies.
One frequent mistake is registering for VAT too late, especially when business activities start earlier than expected. Another is ignoring employer obligations, assuming that small or irregular salary payments do not trigger registration and reporting duties.
Poor shareholder structuring is also common, particularly when companies are set up quickly without considering future dividends or exits. Finally, many founders underestimate the importance of tax planning at incorporation stage, assuming that issues can be fixed later without cost.
In Finland, fixing compliance issues later is almost always more expensive than setting things up correctly from the beginning.
How 1Office Finland supports company formation and tax registration
For international founders, the simplest approach is often to work with a single local partner who understands the full lifecycle of a Finnish company.
1Office Finland supports founders from the initial company registration through tax registration, accounting and ongoing compliance. This integrated approach reduces friction between different advisors and ensures that registrations, reporting and tax payments are aligned from the start.
With local experts who understand Finnish regulations and experience working with non-resident owners, 1Office Finland helps founders avoid common pitfalls while keeping the setup process efficient and transparent.
Final thoughts: starting right is cheaper than fixing later
Finland offers a strong and predictable environment for building a business, but it expects companies to comply properly from the outset.
For international founders starting a company in Finland in 2026, the most important decision is not how fast registration can be completed, but how well the tax registrations, structure and compliance foundations are set up.
Starting right saves time, money and risk later. And in a system as transparent as Finland’s, that advantage compounds year after year.
