Tuesday. 31.03.2020
El tiempo

Vero offers tax arrangements to entrepreneurs affected by coronavirus

Business owners and entrepreneurs can request a deferment of tax debt payments. In addition, the rate of late-payment interest on taxes included in the arrangement will be lowered from 7% to 4%.
Vero offers tax arrangements to entrepreneurs affected by coronavirus

The exceptional circumstances caused by the coronavirus (koronavirus, in Finnish) epidemic may be lethal for many entrepreneurs and small business owners, who will probably see their income reduced due to the declaration of a state of emergency by the Finnish Government.

In order to limit those negative effects, the Finnish Tax Authority (Vero) announced they will ease the terms of payment arrangements for the time being. In addition, the Ministry of Finance is preparing a legislative amendment that will temporarily lower late-payment interest rates for taxes in a payment arrangement.

According to Vero, the primary goal of these changes is to "help businesses and entrepreneurs in the financial difficulties caused by the coronavirus pandemic."

Request a payment arrangement

If your company has difficulties paying taxes due to the coronavirus situation, you can request a payment arrangement with eased terms in MyTax, the online service created to allow taxpayers to handle the majority of their tax obligations just from one single place and using their own electronic devices.

Business owners and entrepreneurs can request an arrangement starting on 25 March 2020. If you request a payment arrangement before that date, your request will be processed according to the regular terms for payment arrangements.

You can also request an arrangement by calling the Tax Authority service number 029 497 028. However, you cannot request the eased terms before 25 March 2020.

As of 25 March, taxes that are included in a payment arrangement request are not recovered by enforcement authorities and the company’s tax debt is not published in the tax debt register or the protest list.

The Tax Administration says they will process all requests for a payment arrangement after the amendment on the lowered interest rate enters into force. Due to the coronavirus situation, there is likely to be a large number of requests, which may result in longer processing times, says Vero.

Due dates will be postponed

According to Vero, the changes in the grounds and terms for payment arrangements will enter into force along with the legislative amendment. These changes will apply to payment arrangements that have been requested between 25 March and 31 August.

  • According to the new terms, the first installment of the payment arrangement will fall due in three months after the arrangement has become active, as opposed to just one month.
  • The Tax Administration will automatically include in the arrangement any new tax debts that form after the payment arrangement has been taken into use until 31 May 2020.
  • According to the legislative amendment, the rate of late-payment interest on taxes included in a payment arrangement would be lowered from 7% to 4%. The lowered interest rate would only apply to taxes that are included in a payment arrangement and that fall due after 1 March 2020.

Terms of the payment arrangement

A payment arrangement provide more time to pay the taxes. If you have an active payment arrangement, the Tax Administration will not send your tax debts to the enforcement authorities for recovery.

In these exceptional circumstances, the Tax Administration will temporarily ease the requirements for granting a payment arrangement. However, you must still meet the following requirements to qualify for an arrangement:

  • You do not have taxes in recovery by enforcement.
  • You have filed all the required tax returns and reports to the Incomes Register (earnings payment reports and employer’s separate reports).

You may be unqualified to get a payment arrangement if your previous arrangement has lapsed.

For guidance from the Tax Authority on how to request a tax arrangement, click HERE

For access to the MyTax service, click HERE