Work in Finland: Everything You Need to Know

Finland, known for its high quality of life, strong economy, and beautiful natural landscapes, is an attractive destination for workers from both the EU and other parts of the world. Whether you’re considering relocating to Finland for a job opportunity or thinking about starting your own business, understanding the Finnish work environment, necessary documentation, wages, social insurance, taxes, and other key factors is crucial. This comprehensive guide will help you navigate these aspects and provide useful resources to facilitate your transition to working in Finland.

Why would you want to move to Finland?

Quality of Life

Finland consistently ranks high in global quality of life indices. It offers good  healthcare, education, and social services, along with a clean environment and a strong sense of community. The work-life balance is highly valued, with a focus on well-being and family time.

Equality and Inclusivity

Finland is known for its egalitarian society. Gender equality and inclusivity are deeply rooted in Finnish culture. The country promotes equal opportunities in the workplace, ensuring fair treatment and respect for all employees.

Innovation and Sustainability

Finland is a leader in innovation, particularly in the fields of technology and environmental sustainability. The Finnish work environment encourages creativity and problem-solving, making it an ideal place for professionals who value forward-thinking and sustainable practices.

Necessary Documents for Working in Finland

For EU Citizens

EU citizens enjoy the freedom of movement within the EU, making it relatively straightforward to work in Finland. The three steps are:

1. Registering Your Residence: EU citizens can reside in Finland for up to three months without registering. For longer stays, you must register your right of residence at the Finnish Immigration Service.
2. Personal Identity Number: You need to obtain a Finnish personal identity number (henkilötunnus), which is required for tax purposes and accessing various services.
3. Local Registration: Register your address with the local registry office (Maistraatti / DVV).

For Non-EU Citizens

Non-EU citizens need to navigate a few more steps:

1. Work Permit: Depending on the nature of your job, you may need a residence permit for an employed person. The application is submitted to the Finnish Immigration Service.
2. Residence Permit: In addition to a work permit, you need a residence permit. The type of permit depends on the duration and nature of your stay.
3. Visa: Some non-EU citizens may also need a visa to enter Finland.

For more detailed information, refer to the Finnish Immigration Service.

At some workplaces there are certain compulsory training courses that one must complete before he/she is allowed to work at the site. For example Occupational safety card courses are quite common requirements at shared workplaces. People who do hot work need to obtain a hot work license and people who work in electrical facilities (or very near to them) need to have electrical safety training SFS6002. This is just good to know and in case you have some idle time before going to the actual workplace  you could then start the actual work more quickly as doing these courses will take some time (one day each). 

How Wages are Determined

Collective Agreements

In Finland, wages are often determined through collective agreements (TES). These agreements are negotiated between employers’ associations and trade unions and cover various sectors. They set minimum wages, working hours, and other employment conditions, ensuring fair pay and standard working conditions. These apply especially to bigger companies and industries where they rely on these. 

Individual Contracts

While collective agreements set the baseline, individual employment contracts can specify wages and benefits above these minimum standards. Especially in the SME sector, individual employment contracts are quite common. It’s important to negotiate your salary and review your contract carefully. In Finland verbal agreements is as binding as a written contract but it is always highly recommended to use a written contract at least in some form. During time people might start to remember things a bit differently so always good that figuratively speaking you have something on paper. Email, SMS, Whatsapp messages are also better than just relying on memory of  what was spoken. 

Social Insurance

Overview

Finland’s social insurance system provides comprehensive coverage, including healthcare, unemployment benefits, and pensions. Contributions to social insurance are mandatory and shared between employees and employers.

Key Components

1. Health Insurance: Finland offers universal healthcare. Both employees and employers contribute to the health insurance system.
2. Unemployment Insurance: Provides financial support if you become unemployed. Contributions are deducted from your salary.
3. Pension System: Finland has a robust pension system, with contributions ensuring financial security in retirement.

For detailed information on social insurance contributions, visit the Finnish Centre for Pensions.

Taxes

Income Tax

Income tax in Finland is progressive, meaning the rate increases with higher earnings. The tax system is divided into national and municipal taxes. 

Other Taxes

1. Church Tax: If you are a member of the Finnish Evangelical Lutheran Church or the Orthodox Church, you will pay a church tax.
2. Capital Gains Tax: Applies to income from investments and property sales.

Tax Deductions

Finland offers various tax deductions, including work-related expenses, travel costs, and certain personal deductions. It’s advisable to consult with a tax advisor to optimize your tax situation.

For more information on taxes, refer to the Finnish Tax Administration.

Starting Your Own Business in Finland

Business Structures

Finland offers several business structures:

1. Sole Trader: Ideal for individuals starting a small business.
2. Partnership: Suitable for businesses run by two or more people.
3. Limited Liability Company (Oy): Common for larger businesses, offering limited liability to owners.
4. Cooperative: Often used for businesses aiming to benefit their members.

Costs

Starting a business involves various costs:

1. Registration Fees: Registering a business name and entity costs range from €60 to €380, depending on the business structure.
2. Operational Costs: These include rent, utilities, salaries, and marketing expenses.
3. Taxes: Businesses must pay corporate tax (20%), VAT (24% standard rate), and other applicable taxes.

Support and Resources

Finland provides extensive support for entrepreneurs, including funding, mentoring, and networking opportunities. Useful resources include:

Cost of Living in Finland

Understanding the cost of living is crucial for financial planning. Major expenses include:

1. Housing: Rent varies significantly between cities. In Helsinki, expect to pay between €800 and €1,500 for a one-bedroom apartment.
2. Food: Monthly grocery expenses for one person are approximately €200-€300.
3. Transportation: Public transportation is efficient, with monthly passes costing around €60 in major cities.
4. Utilities and Internet: Expect to pay around €100-€150 monthly for utilities and €20-€30 for internet.

Conclusion

Working in Finland offers numerous benefits, including a high quality of life, robust social insurance, and a supportive business environment. Whether you’re from the EU or another part of the world, understanding the necessary documentation, wage determination, social insurance, taxes, and costs associated with starting your own business is essential. By leveraging the resources and information provided in this guide, you’ll be well-equipped to make a successful transition to working in Finland.

For further details and updates, visit the following useful links:

• Finnish Immigration Service
• Finnish Centre for Pensions
• Finnish Tax Administration
• Business Finland
• Enterprise Finland