1.
Grants

2. Grants Grants from public sector bodies
Grants
Grants from public sector bodies
Grants provided by the state, municipalities or other Finnish public sector bodies or the Nordic Council are always tax-exempt.
Grants from private sector bodies
Grants provided by private grantors (other than public sector bodies) are taxable income to the extent that the combined total amount of the grants from private grantors and any grants from public sector bodies exceeds the annual amount of the state artist grant after all expenses have been deducted.

3.
The following bodies are considered public sector bodies for taxation purposes:
The state of Finland
Municipalities and joint municipal authorities
Regional arts councils
Evangelical Lutheran Church of Finland and the Orthodox Church of Finland
Bank of Finland
The Social Insurance Institution of Finland (Kela)
Central Arts Council
Research councils (Academy of Finland)
The Finnish Work Environment Fund
Other public sector bodies do not provide grants. All foundations and funds (except the Finnish Work Environment Fund), Finnish universities and other Finnish higher education institutions, foreign governments and public sector bodies outside Finland are considered private grantors.

4. Different types of grants
When a grant provided for scientific work / artistic activities is not intended to cover expenses, it is, as a rule, considered a livelihood grant (up to the amount of a tax-exempt artistic grant), the purpose of which is to allow the recipient to engage in scientific work / artistic activities on a full-time basis during the grant period.
A recipient of a tax-exempt livelihood grant may deduct the expenses arising directly from scientific work / artistic activities from taxes as expenses arising from the generation of income (KHO 2007/230).

5. Different types of grants
Different types of grants
Expense grants
Expense grants are intended to cover specific expenditure items (such as a conference trip).
They are for specific purposes.
The expenses should be primarily covered with the grant provided for the purpose.

6. Different types of grants
Different types of grants
Grants provided to research groups
Can be provided as personal grants to the group members mentioned in the grant decision.
The head of the group and its members are each required to declare the personal grants that they have received.
If necessary, the head of the group will provide details of the manner in which grant provided to the group has been spent.

7.
Grants as income
In 2016, the state artist grant amounted to 20, euros.
If you have received grants from public sector bodies and private grantors during the tax year, the amount exceeding the state artist grant that has been provided by private grantors is taxable income.
Example 1
Grants provided by public sector bodies 10,000 euros
Grants provided by private bodies 15,000 euros
Amount of taxable grants: 25, , = 4, euros
Example 2
Grants provided by public sector bodies 22,000 euros
Grants provided by private bodies 3,000 euros
Amount of taxable grants: , ,000
= 3,000 euros

8. Grants and expenses arising from the generation of income
Grants and expenses arising from the generation of income
Expenses arising from the generation and keeping of income are tax-deductible.
Expenses arising from scientific work and artistic activities are tax-deductible as expenses arising from the generation of income if they have not been covered with tax-exempt grants.
As a rule, expenses arising from the generation of income are deducted from taxes in the year in which they have been paid.
The expenses associated with the grant arising in subsequent years can be considered as reserves if you are able to provide details of the expenses.

9. Grants and expenses arising from the generation of income
Grants and expenses arising from the generation of income
If you have received a tax-exempt grant for covering expenses, the expenses in question are not tax-deductible.
Likewise, a grant provided for covering expenses is not considered when the taxable amount of the grant is determined (see example 3).
If the actual expenses have been smaller than the expense grant provided to cover them and you are not obliged to return the unused part of the grant
the part of the grant exceeding the actual expenses must be considered when the taxable part of the grant is determined (see example 4).

10. Grants and expenses arising from the generation of income
Grants and expenses arising from the generation of income
Example 3
A travel grant provided by a public sector body for a conference trip (1,500 euros)
A grant provided by a private foundation for dissertation work (25,000 euros)
Expenses arising from the conference trip 2,600 euros
> the taxable part of the grant is 25, , = 4, euros
> only 1,100 euros of the conference-related expenses are tax-deductible.
Example 4
A grant provided by a private body for expenses arising from an arts project (4,500 euros)
An annual livelihood grant provided by a public sector body (20,000 euros)
Actual expenses arising from the arts project 3,000 euros
> the taxable part of the grant is 21, , = 1, euros
> The expenses amounting to 3,000 euros that were covered with the tax-exempt grant are not tax-deductible.

11.
Common expenses arising from the generation of income in scientific work
Dissertation work and post-doc research are examples of scientific work
Common expenses arising from dissertation work
Cost arising from working at home (computer, telephone and home office expenses)
Purchasing of professional literature
Field work
Conference trips
Printing the dissertation
Public examination of the dissertation
However, the expenses arising from clothing, catering and the conferment ceremony are not tax-deductible. Under the well-established taxation practice these items are not considered as expenditure directly arising from scientific work.

12.
Common expenses arising from the generation of income in scientific work
Expenses arising from conference trips and other trips made as part of scientific work may include
travel costs
accommodation and other living expenses
higher living expenses

13. Travel, accommodation and living expenses
Travel, accommodation and living expenses
Tax-deductibility of the expenses arising from trips made as part of scientific work depend on the modes of transport.
If you use your own car, the deduction is 0.24 euros/km.
The Finnish Tax Administration issues a decision each year on the deduction per kilometre.
You may incur accommodation expenses during research and conference trips. They may include hotel expenses or costs arising from renting an apartment in the location where the research is carried out.
When you are using your own car the deduction is in accordance with the decision issued by the Finnish Tax Administration each year. Please note that the deduction is not equal to the tax-exempt allowance provided by your employer.

14. Higher living expenses
Higher living expenses
If you have incurred higher living expenses during the trip, you should provide details of how and where the costs have arisen.
If you have incurred expenses but you are unable to detail them you can estimate the costs as follows:
For domestic trips 14 or 26 euros (in 2015) for each day.
For foreign trips, the sum corresponding to the per diem allowance for foreign travel per day. However, if you are staying in a home-like accommodation during your foreign trip, you may only deduct one half of the per diem allowance for foreign travel.
For more information about higher living expenses, see
the harmonisation guidelines of the Finnish Tax Administration (section 2.4)
the instruction Expenses arising from the generation of earned income (section 5.9)
the amounts of per diem allowances for foreign travel
If it has been established that the taxpayer has incurred expenses but it has not been possible to specify the actual amounts, the deduction can be approved if the taxpayer provides details of where or how the higher living expenses used as a basis for the deduction request have arisen.

15.
Other common expenses arising from the generation of income in scientific work / artistic activities
Home office deduction
760 euros / year, full-time use
380 euros / year, part-time use
190 euros / year, occasional use
Purchasing computer and Internet costs
100 per cent, if mainly used for work
50 per cent, if partially used for work
0 per cent, if only occasionally used for work
Read more about the deductions in the Finnish Tax Administration's harmonisation guidelines (section 2.2).
Expenses arising from the purchasing of equipment
If the purchase price of the equipment used for work is less than 1,000 euros, you can enter the whole amount as one-off deduction.
If the purchase price is 1,000 euros or higher, you are entitled to a 25 per cent annual deduction through reducing-balance method.
If the remaining amount is less than 1,000 euros, you can enter the whole amount as one-off deduction.

16. Example 1: Temporary stay in a foreign country
Example 1: Temporary stay in a foreign country
A researcher spends one year in the USA to carry out scientific research in a university. The researcher has received a grant of 60,000 euros from a private Finnish foundation and a grant of 20,000 euros from the university in the USA. The expenses associated with the scientific work amount to 24,000 euros.
Standard rules and provisions concerning grants normally also apply to grants received from outside Finland and the expenses associated with them even if the research work takes place outside Finland.
However, the grants provided to researchers by American universities are interpreted as pay and they are not taxed in Finland or included in the total amount of grants if the recipient stays a maximum of six days in Finland each month during the research work taking place outside Finland.
However, the expenses arising from the research work are associated with the grants received from both Finland and the USA.
The expenses associated with the tax-exempt income received in the United States are not tax-deductible in Finland.
Only a specific proportion (18,000 euros) of the expenses amounting to between 60,000 and 80,000 euros is tax-deductible.
The part of the grant taxed as earned income amounts to 21, euros (grants provided in Finland 60,000 euros - expenses arising from the generation of income 18,000 euros - artist grant 20, euros).

17.
Example 1 continues
The total expenses arising from the scientific work carried out by the researcher (24,000 euros) comprise the following cost items typical of research work taking place in a foreign country:
Travel and moving expenses
Personal travel expenses incurred by the researcher and moving expenses at the start and end of the stay are tax-deductible. The expenses arising from the travel of the family members are not tax-deductible even if the relocation of the other family members had been taken into account in the total amount of the grants received by the researcher.
If the moving costs are joint family expenses, the share of the costs incurred by the researcher must be estimated. In this example, the spouse and two small children of the researcher have travelled with the researcher, which means that the researcher will pay 1/3 of the costs.
The expenses arising from holiday trips made to Finland during the stay are not tax-deductible.

18. Example 1 continues Living costs
Example 1 continues
Living costs
The higher living expenses arising from the stay in the USA and incurred by the researcher are tax-deductible.
If the grant recipient or his/her family will also keep their apartment in Finland, all costs arising from living in the foreign country are, as a rule, considered as higher living expenses. However, as in this case the apartment has also been used by the researcher’s family, the higher living expenses have partially resulted from the family joining the researcher and the tax-deductible share of the researcher is estimated at one third of the total. The estimates are made on a case-by-case basis.
If the apartment located in Finland had not remained in the possession of the researcher and his/her family members during their stay in the USA and had been put out for rent, the expenses arising from the apartment in the USA would only be considered as higher living expenses to the extent that they had exceeded the expenses normally arising from living in Finland during the same period (again only the researcher's share of the higher expenses would be tax-deductible).
Movable property located in the apartment is not considered as living expenses but as higher livelihood expenses.

19. Example 1 continues Higher livelihood expenses
Example 1 continues
Higher livelihood expenses
The researcher may deduct the higher livelihood expenses arising from the trip and the deduction may amount to 50 per cent of the per diem allowance for foreign travel per day of stay. Alternatively, the researcher may make a deduction that corresponds to the actual costs but in that case all higher livelihood expenses must be detailed.
As a rule, a deduction amounting to 50 per cent of the per diem allowance covers all costs arising from the stay, except for the expenses directly arising from scientific work, as well as moving, travel and living costs.
Travel costs in the foreign country
Travel costs between the place of residence in the USA and the university, as well as all other travel costs in the USA arising from the scientific work, are deducted from the grants.
Deductions for the use of one's car are on the basis of the driver's log. Costs arising from private trips are not tax-deductible.

20.
Example 2: Artist grants and expenses arising from the generation of income
Grants received by a visual artist
A grant of 25,000 euros provided by a public sector body, which includes an expense grant of 8,000 euros for an artistic project
A general grant of 15,000 euros provided by a private body
Expenses arising from artistic activities
Cost arising from an arts project (8,000 euros)
Other project-related costs (9,000 euros)
The expenses arising from the arts project are covered with the tax-exempt grant provided for the purpose. Tax- deductible expenses amount to 9,000 euros.
A total of 17,000 euros of the public sector grant and 15,000 euros of the private grant are considered when the taxable income is calculated (totalling 32,000 euros).
When the remaining tax-deductible expenses arising from the generation of income are also considered the taxable income available to the recipient will total 2, euros (32,000 euros - artist grant of 20, euros - expenses arising from the generation of income amounting to 9,000 euros)

21.
Example 2 continues
In accordance with the decision on providing the expense grant, a total of 8,000 euros of the expenses of 17,000 euros spent by the artist on generating income have been spent on the preparation of the anniversary exhibition.
The remaining 9,000 euros that is considered in taxation and that have not been covered with the expense grant consist of the following items, which are typical of visual artists:
Material costs
Expenses arising from a separate workshop
Computer and telephone expenses
Membership fees in an artistic organisation that have not been deducted on a tax return
Separate insurance for a self-employed individual, which covers the tools or the works of art
Expenses arising from travel to temporary locations (building of exhibitions, etc.)

22. MYEL insurance contributions based on grants
MYEL insurance contributions based on grants
MYEL insurance contributions are not expenses arising from the generation of income as they are separately deducted from earned net income.
You should file your MYEL contributions under “Mandatory pension and unemployment insurance contributions” on the online tax return / pre-completed tax return.
MYEL insurance contributions must be deducted in the taxation of the year in which they have been paid, irrespective of the year in which the grant used as a basis for the contribution is considered to have been paid.
No losses are verified for contributions that you have failed to deduct in the year of payment.

23. Filing grants in taxation
Filing grants in taxation
You can file your grants online tax.fi/taxreturn. The service is available in spring when tax returns are filed. You can submit your grants under “Other earned income”.
You should only declare the taxable part of the grants under "Other earned income”.
If the total amount of the grants remains under the tax-exempt amount of the artist grant or all grants have been provided by public sector bodies, you can leave the box “Other earned income” empty.

24. Filing grants in taxation
Filing grants in taxation
If you have received grants for artistic activities, you should file the income and expenses under “Add artist or freelancer income and expenses”.

25. Filing grants in taxation
Filing grants in taxation
If you file the grants on paper, you should enter them in section 1.4 ("Other earned income”).

26.
Filing grants
If you have received grants for artistic activities, you should file the income and expenses on form 15.

27. Paying the taxes on your grants
Paying the taxes on your grants
As tax prepayments
You can pay the taxable grants as tax prepayments using the credit transfer forms supplied by the Finnish Tax Administration.
As tax withheld from your salary or other earned income
If you have other income subject to withholding, you can obtain a new tax card in which the taxable part of the grant is considered as income and the MYEL contributions as deductions.
As supplementary prepayments
If you are no longer able to apply for the tax prepayment option or the taxes would be too low, you can pay the amounts on an unprompted basis as supplementary prepayments. You can estimate the payable amounts using the tax percentage calculator.
As back taxes
If you have not paid the taxes as prepayments, you have to pay them as back taxes. You can check the amount of the taxes from the taxation decision for the year in question.

28. Questions? For more information, go to tax.fi
Taxation of grants, scholarships, awards and other prizes
Expenses arising from the generation of earned income
See answers to earlier questions in the Answer Bank or submit a new question
Go to Live Chat if you need advice on how to file grants online. The channel is open in spring during the filing of tax returns.

29.
For you.