Do you feel confused every time you access the tax administration portal? If so, rest assured, because you are not the only one. Half of the new entrepreneurs do not understand the advice given by the Finnish tax administration (Vero) and many of the taxpayers are lost when carrying out the basic procedures.
That is what emerges from a survey conducted last Autumn by Vero, who acknowledges in its news bulletin that "about half of recently started businesses find it challenging to understand the guidance offered by the tax administration".
In fact, says the release, "although the tax administration's taxpayers services and guidance for new businesses is appreciated, a number of respondents hoped to get clearer and simpler instructions, especially on how a small business should deal with its most frequently occurring tax routines".
In autumn 2018 the Finnish tax administration conducted a Webropol survey where new entrepreneurs were asked to complete an online questionnaire. Vero asked them about the tax questions that seem difficult, and about what improvements the respondents would like to see in the services offered by the tax administration.
The questionnaire was filled in by 650 businesses, of which 617 were self-employed individuals, 27 owners of a newly established limited company, and 6 shareholders of a partnership.
The results of the survey
The most striking result shows that about one-half of the respondents stated that when their business was at its initial stages, they often had difficulty in understanding the tax administration’s guidance.
Many respondents wanted the guidance to be easier to understand, explains Vero. A frequent suggestion was to make a checklist for important tax routines.
Respondents originating from other countries pointed out that more services should be available in English, says Aulikki Kannala from the Individual Taxation Unit, in charge of services for new businesses.
According to Vero, one "important challenge that surfaced" was the question of how to deal with the basic obligations of a business taxpayer: how to submit tax returns, and how to request prepayments.
Many respondents indicated that they do not pre-pay income taxes, and have not requested the Tax Administration to prepare a decision on prepayments, because their business does not generate enough income. They put special emphasis on the fact that it is difficult to give a good estimate about their future income and prepayments.
Entrepreneurs without any guidance
When they were setting up their business, the respondents had sought advice from a number of sources. Almost 40 percent told that they have not contacted the Tax Administration to ask for guidance in business-related questions.
More than 20 percent indicated that they have never used the guidance offered by any public authority, including Local Enterprise Centres, TE Offices, and Centres for Economic Development, Transport and the Environment (ELY-keskus).
"Most of the respondents in our survey were self-employed operators of a trade or business. We are planning a survey directed towards limited-liability companies as well. Thank you to all respondents. Your answers and suggestions help us improve our new business guidance", says Aulikki Kannala.