# Starting a Business in Finland

> The comprehensive guide to establishing and running your own business or light entrepreneurship in Finland.

Canonical HTML: https://feanordic.fi/en/business-guide/
Markdown alternate: https://feanordic.fi/en/business-guide.md

## Phase 1: Preparation
Before you register anything, lay the groundwork for a successful business.

1. **Choose Your Path**: Decide between Limited Company (Oy) for liability protection and tax benefits, Sole Trader (Toiminimi) for simplicity, or Light Entrepreneurship (Kevytyrittäjyys) for quick starts without a Business ID.
2. **Immigration & Status**: Ensure your residence permit allows entrepreneurship. EU citizens generally just need to register right of residence. Non-EU citizens may need an Entrepreneur Residence Permit.
3. **Market & Networking**: For freelancers, connect with brokers like Witted, Thriv, and Finitec. For SMEs, leverage B2B networks, chambers of commerce, and local enterprise agencies (Uusyrityskeskus) to find partners and business premises.
4. **Grants & Financing**: Apply for the Startup Grant (~€740/month) BEFORE registering. For larger investments and growth, explore loans and guarantees from Finnvera, the state-owned financing company.

## Choose Your Mode
Compare the most common ways to work in Finland.

### Light Entrepreneurship
Kevytyrittäjä

- Income range: < €20k / year
- Pros: No paperwork; No fixed costs; Easy to start/stop
- Cons: High service fees (5-7%); No tax planning; Limited expense deductions
- Best fit: Great for side hustle or testing business ideas.

### Sole Trader
Tmi (Toiminimi)

- Income range: €20k - €60k / year
- Pros: Simple administration; Keep 100% of profit; Expense deductions
- Cons: Personal liability; High progressive tax on high income; Full responsibility
- Best fit: Best for full-time freelancers with moderate income.

### Limited Company
Oy (Osakeyhtiö)

- Income range: > €60k / year
- Pros: Flat 20% corporate tax; Dividend benefits; Limited liability; Fringe benefits
- Cons: More bureaucracy; Higher accounting costs; Double taxation (Corp + Personal)
- Best fit: Ideal for high earners and long-term business growth.

## Phase 2: Foundation
Setting up the legal and financial infrastructure.

5. **Registration**: Register via YTJ (BIS). Establishing an Oy costs ~€280. You must join the Trade Register, Prepayment Register, and VAT Register (mandatory if turnover > €20,000/year).
6. **Banking & Accounting**: Open a business bank account (e.g., Nordea, OP, Holvi). Hire a professional accountant or use services like ours to handle bookkeeping, VAT, and annual reports.
7. **YEL Insurance**: Mandatory if your work income (YEL income) exceeds ~€9,300/year (2025). The contribution is ~18.8% and it forms the basis for your entire social security.
8. **Tax & Prepayment**: Apply for tax prepayment to pay income tax during the year. Set your salary and optimize tax-free dividends (for Oy) with your accountant.

## Phase 3: Operation & Safety
Securing your future and managing risks while running the business.

9. **Unemployment Fund**: Join the Entrepreneur Fund (Yrittäjäkassa) if your YEL income is at least ~€15,200/year. This secures earnings-related unemployment benefits.
10. **Occupational Healthcare**: Organizing occupational healthcare is optional for self-employed but highly recommended. Kela reimburses ~50-60% of costs, and it is a tax-deductible expense.
11. **Insurances**: Liability Insurance is often required by client contracts. Voluntary Accident Insurance and Health Insurance offer further security and tax benefits.
12. **Unions & Networking**: Consider joining "Suomen Yrittäjät" for legal advice and benefits. Network continuously to keep your project pipeline full.

## Useful Resources
Useful links to official Finnish authorities and financial systems.

- [YTJ (BIS)](https://www.ytj.fi/en/index.html): Business Information System for registrations.
- [PRH](https://www.prh.fi/en/index.html): Patent and Registration Office.
- [Finnvera](https://www.finnvera.fi/eng/): State financing and guarantees for SMEs.
- [Startup Grant Info](https://toimistot.te-palvelut.fi/uusimaa/starttiraha): Official requirements for the Finnish startup grant.
- [Finlex](https://www.finlex.fi/en/): Database of Finnish legislation.
- [Business Finland](https://www.businessfinland.fi/en/): Support for international companies.

## Contact Us
Not sure which path to take? We can help you decide.

- [Contact Us](https://feanordic.fi/en/contact/)