Finland is one of the top countries in the world as far as numbers are concerned. Whether it’s the life standard, business opportunities or pure innovation, this country has it all. Among the world’s frontrunner in these categories, Finland is a great country for starting a business, whether you are a local or a foreign citizen.
A sole proprietorship is called many names in Finland - private trader, sole trader or self-employed. In colloquial Finnish, private traders are often referred to as ‘toiminimi’, ‘t:mi’ or ‘yksityisliike’. In Finnish legislation, however, ‘toiminimi’ means the company name. However, whatever term we use, the rules are basically the same. Starting a sole proprietorship in Finland is pretty easy and doesn’t require a long registration process.
Business registration is not mandatory for citizens of EEA (European Economic Area), as long as they are running a sole proprietorship in Finland. However, if your business meets certain criteria, you will need to file a Start-up notification (see below). Every other form of business will need to be registered. There are also no special taxes involved for citizens of the EU, when registering as a private trader in Finland. Additionally, it is common for businesses to register to registers governed by the Central Tax Administration and depending on the scale of the business, the registration is often mandatory.
Choose a business name
Before you start with the registration process, you will want to choose a name for your business. In case of a sole proprietorship, you can use your own name for the business. However, the business name is usually a combination of the name of the owner and the location the business is situated in. If neither of these options suit you, you can choose a unique name for your sole proprietorship. Just make sure you register this name with the Finnish Patent and Registration Office (PRH).
In Finland, you are required by law to file a Start-up notification with the PRH Trade Register if your business:
- operates in permanent premises, outside your home; or
- has employees other than your family; or
- operates in a licensed trade.
Registering your business also gives protection to your company name. Submitting this notification will cost you 60 EUR if you submit it online, or 115 EUR if you submit it in paper. If you would like to submit this notification online you need to have a Finnish personal identity card, be over 18 years old and have your HST card. If you decide to submit your Start-up notification in paper, you will need to fill out form Y3. In both of these, you will need to submit your personal details, a proposed name for the company (and two alternatives), address and contact details, municipality where the company is managed and the company’s line of business.
After you submit the Start-up notification, you will get a Business ID after paying some handling fees. If you request it, your business name and ID will be entered into the government registers such as VAT Register, Prepayment Register, and the Employer Register of the Finnish Tax Administration, which should take no more than three weeks.
If you need any help with legal matters regarding business registration, you can rely on our team of legal experts to help you.