This year, you should check your tax deductions, especially if you have done a lot of remote work. For example, the commuting expenses (matkakulut) between home and work can be deducted only for the days when you have actually made this trip. You cannot deduct travel (commuting) expenses for remote working days.
On the other hand, as of 13.8.2020, you can also reduce the cost of face masks as travel (commuting) expenses between home and work (matkakulut) if you use the mask in public transport between home and work and pay for the masks yourself. The deduction is two (2) euros for each day you have traveled between home and work on public transport.
However, if there has been a lot of remote work, this year could easily be the case that the own-liability for commuting costs, including masks’ costs, will not exceed the own-liability threshold and then there will be no tax benefit. The own-liability threshold for commuting and travel expenses is €750 in 2020. You must report these costs yourself.
Example 1:
- commuting expenses amount is €4 400 and it is adjusted by €750 of own liability, and resulting in €3 650 as deductible commuting expenses.
On the other hand, remote working and the organization of a remote workspace may have incurred costs this year, which entitle, for example, a higher than before deductions for workrooms expenses (työhuonevähennykset) or deductions for other costs caused by the production of wage income (workspace, own tools and professional literature).
Expenses caused by the production of income (tulonhankkimismenot) are deducted from the wage income, and they decrease the amount of taxable earned income. All hired labour automatically receive a € 750 deduction. The Tax Administration makes the deduction on employee’s behalf. However, the deduction may not exceed the wage income amount. If expenses caused by the production of income exceeds €750 per year, employee must report the expenses itself. You must indicate the amounts in full, do not subtract the own-liability amount yourself!
Example 2:
Wage income amounts to €10 000. In tax return has reported the following expenses for the production of income:
- membership fees €150
- commuting expenses €1 000
- acquisition of professional literature €300
The following deductions will be made:
- membership fees of €150
- travel expenses of €250 (own liability €750, thus €1 000 - €250)
- and deduction for the costs caused by production of income (Tulonhankkimismenot) €750 - deducted automatically.
(professional literature costs are not deducted, as they are lower than €750)
Example 3:
Wage income amounts to €10 000. In tax return has reported the following expenses for the production of income:
- membership fees €150
- commuting expenses €1 000
- acquisition of professional literature €500
- workspace deduction €410
The following deductions will be made:
- membership fees of €150
- travel expenses of €250 (own liability €750, thus €1 000 - €250)
- and other expenses caused by production of income at a total of €910 (€500 + €410). The total amount in €910 will be deducted, not €750.
More detailed information can be found at Finnish Tax Administration website.
Source text can be found at veronmaksajat.fi.
Published 27.08.2020, FINREPO