With the start of the new year, it’s time to take a look at what is new in Finland in 2024.
As we have done in previous years (eg. last year), we’ll discuss specific changes in social benefits, taxation, and laws and regulations. We’ll start with benefits.
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Changes in social security benefits
There are always some changes to social security benefits at the start of a new year. This year, however, there are more changes than usual.
This year, pensions, disability allowances, social assistance, and conscript’s allowances increased by 5.9 % at the start of this year. Also, child support payments and child maintenance allowances increased. The full child maintenance allowance increased from 186.77 euros to 196.02 euros. Persons liable for child support payments must pay about 4.84 % more this year than last.
There are other increases as well. For example, the annual limit on out-of-pocket medicine costs increased to 626.94 euros. Also, the KELA reimbursements for private medical care went up.
While the benefits mentioned above saw an increase at the start of this year, some others decreased. There are, for example, some cuts to unemployment benefits. These include cuts to or complete elimination of child increases to unemployment benefits and the elimination of the 300 euro exempt amount on April 1, 2024. The elimination of the 300 euro exempt amount means that after April 1 all income earned during a period of unemployment will reduce benefits.
You can find a full list of changes and more information on the specifics on KELA webpages here.Â
What is new in Finland in 2024: Taxation
Similar to social security benefits, the tax code always changes at least somewhat at the start of a new year. Some of these changes will increase taxes on some and others will lower it.
For example, there are changes to real estate tax. The minimum rate of tax on the land where the real estate is located rose from 0.93 % to 1.30 %. This affects real estate owners in municipalities where the minimum rate was lower than 1.30 %.
The deduction for commuting expenses decreased at the start of this year. The maximum amount of the deduction lowered from 8 400 euros in 2023 to 7 000 euros this year.
The overall employee income tax percentages decreased at the start of this year. Most of this decrease is due to the decrease in social security payments wage and salary earners have to make. The Taxpayers Association of Finland has calculated that the decreases in income tax percentages vary from 0.5 to 1.2 % depending on one’s income level. The decrease is higher in higher income brackets.Â
The transfer tax rate on real estate was lowered from 4 to 3 %. The transfer tax rate on shares in housing companies decreased from 1.6 to 1.5 %. These deductions are applied retroactively. If you have paid transfer tax on real estate or housing company shares after 12 October 2023, the government will refund the excess transfer tax. Until the start of this year, first-time home buyers were exempt from the transfer tax. This is no longer the case.
Tax on beer came down about 4.9 % at the start of this year. However, the tax on stronger alcohol went up by 8.3 % on average.
You can find more on changes in the tax code here.
Other changes
If you like to fish or hunt, you should know that the price of fishing and hunting permits went up at the start of 2024. You can find more about fishing, hunting, and related permits here.Â
The law related to fire alarms changed at the start of 2024. The new law transfers the responsibility for maintaining the apartment fire alarms from residents to the housing company and building maintenance.
If a fire alarm is missing or poorly maintained, it affects the safety of other units in the building. By transferring the responsibility for fire alarms to the housing company, the government expects fire alarms to be better maintained and more widely installed. Although fire alarms have been mandatory in Finland for years, research has shown that they tend to be poorly maintained or completely missing quite often. The Finnish National Rescue Association SPEK reported in 2022 that 70 % of rental units didn’t have fire alarms. In another study from 2021, SPEKs reported that with fires resulting in death between 2009 and 2018, the fire alarm was missing or didn’t work in 63 % of the cases. In nearly 50 % of these fires, the home in question didn’t have fire alarms at all.Â
The start of 2024 also saw increases in some of the processing fees of the Finnish Immigration Service. For example, the processing fees for permanent residence permits are now different depending on whether you apply online or submit a paper application. The fee for online application is now 220 €. For the paper application, it is 270 €. More on the fee increases on the Migri homepages here.Â
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