Tax return & tax deductions: match made in heaven – tips for checking a light entrepreneur’s tax return

It is again that time of the year when pre-filled tax returns and reviewing them are just around the corner. As a light entrepreneur, to get all the possible benefits from tax deductions and make it easy for you to check your tax return, you should prepare beforehand and report information through MyTax well in advance.

Tax returns will arrive to MyTax in random order now during March-April. If you are correcting a tax return, the deadline is either May 9th, May 16th, or May 23th, 2023. You can see the date from your own tax return and MyTax. You can make corrections in MyTax or on paper. And best of all, if there is nothing to correct in your tax return, you do not have to do anything!

Online tax return – anticipate and notify in advance

In MyTax, you can report some information for the 2022 tax return in advance, which is recommended (you will thank yourself later for not leaving everything until the last minute). If you have any of the following expenses and you haven’t reported them within a year, you can already submit them to MyTax:

• Travel expenses (between home and work)
• Deductions for second home for work
• Expenses for the production of income
• Rental income
• Capital gains and losses from other property than trading with securities
• Reduction of reduced ability to pay taxes

A light entrepreneur should report at least these work-related expenses

1 Eezy’s service fee and employer’s health insurance payment

You can deduct Eezy’s service fee and your employer’s health insurance payment in your own taxation because they are considered income-generating expenses. Note, however, that you can only deduct your employer’s health insurance payment if you have the YEL insurance, in which case the health insurance payment is deducted from your salary.

2 Taxable travel expenses

Taxable travel expense should be reported annually in your personal tax return. If you do not declare taxable travel expenses in your tax return, the Tax Administration will treat these taxable expenses as earned income, and you can expect some residual tax.

For mileage allowances, the deduction is made on the personal tax return under Travel and commuting expenses – Other than commute – Temporary business trips and travel in special sectors.

Daily allowances can be reported in the section Expenses for the production of income – Deduction based on standard value.

You can download a summary of taxable travel expenses and daily allowances paid through Eezy on our online service Menu – Salaries – Tax return summary.

Tip! If you know in advance that you will receive a lot of taxable travel expenses during the year, you should raise your own tax rate at the beginning of the year.

Read Tax Administration’s instructions about travel expenses and other deductions for light entrepreneur.

3 YEL-insurance payments

You can deduct the YEL insurance payments in either your own or your spouse’s taxation. You can declare the YEL payments with a tax return via MyTax (section: Statutory pension contributions for non-wage income).

4 Other expenses for the production of income

If the expenses of the work have not been reimbursed to you through Eezy already during salary payment, you can and should declare them with a personal tax return as production of income deductions. These are:

• Home office deduction
• Professional literature, research tools and scientific literature
• Expenses on the purchase, maintenance, and repair of tools
• Expenses for the purchase of a computer and its peripherals
• Telecommunication connection expenses
• Representation expenses

You can declare these expenses from the production of income in Mytax.

Best of all – tax-free expenses do not need to be reported

If you have been paid work-related expenses through Eezy as tax-free expenses, they will no longer be reported as deductions on your tax return. You can find more detailed instructions on expenses for the production of income and the right to deduct them on the Tax Administration’s website: Expenses for the production of income from earned income. If you have work-related expenses from the past year but have not been reimbursed through Eezy, you may want to report the expenses on your personal tax return.

Here are some more links to the Tax Administration’s instructions:

• The pre-completed tax return – making corrections
• Here’s how to complete information on paper

And then just wait for the pre-completed tax return! You can already download the summary from the online service and save these instructions so the reviewing of the tax return and any possible corrections will feel as smooth as the cream cheese on your bagel.