Germany - Finland Double Tax Treaty
Germany - Finland Double Tax TreatyUpdated on Thursday 15th December 2016
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Germany signed a treaty for the avoidance of double taxation with Finland in 1982. The agreement provides the legal framework for the taxation of income and property taxes applicable to the tax residents of the two states. Finnish businessmen operating a company in Germany can benefit from the provisions of the treaty related to the taxation of corporate income. Businessmen and other persons interested in the provisions of the Germany – Finland double tax agreement (DTA) can address to our German law firm for legal assistance.
Taxes under the German – Finnish DTA
The main subject of the German – Finnish DTA refers to the taxes which are applicable to the tax residents of a country performing taxable activities in the other country. In this sense, the representatives of the two states have agreed upon a set of taxes.
In Finland, the local authorities will apply the next taxes to the German tax residents:
• the state income;
• capital tax;
• the municipal income tax;
• the church tax.
Finnish natural persons and legal entities operating taxable activities in Germany are imposed under the following taxation scheme:
• the income tax;
• the property tax;
• the business tax.
The agreement is applicable to similar taxes available in the two jurisdictions, but the differences may appear from the legislation available in each state. In the situation in which one of the contracting states may impose a new tax, it is compulsory for its representatives to announce the modification to the relevant authorities in the other state. Our German law firm can provide more details on the way in which the above mentioned taxes are imposed here.
Taxation applicable to immovable property in Germany
According to the provisions of the treaty, the income obtained from an immovable property in Germany will be taxed in Germany. Article 6 prescribes that immovable property includes establishments set up in agriculture and forestry.
The taxation is also applicable in the situation in which the immovable property is rented.
Businessmen interested in receiving more details on the German – Finnish double taxation treaty are invited to contact our attorneys in Germany.