As of 1 January 2017, the Finnish Statute of Limitations applicable to the filing of Withholding Tax (“WHT”) reclaims has been reduced to three years.
Until the end of December 2016, the Statute of Limitations period in Finland was set at five years in respect of WHT reclaims. The period was calculated as of 1 January of the year following dividend distribution. As of January 2017, however, the Statue of Limitations rules have been amended and WHT reclaims should now be filed within a three-year period. The calculation of the new Statute of Limitations follows the previous formula, i.e. from the beginning of the year following the dividend payment year. For instance, if the dividend payment day is 4 May 2017 the statutory period starts on 1 January 2018 and ends on 31 December 2020.
The way forward
In spite of the above, please note that the former 5-year Statute of Limitations is still applicable to WHT decisions rendered prior to 2017. For instance, if the WHT decision was rendered in 2016, the due date for the claim for an adjustment will be 31 December 2021.
Under the new legislation, a change in the appeal period has also been enacted. Indeed, the taxpayer can file an adjustment claim for decisions regarding filed WHT reclaims rendered from 2017 onwards within 60 days after being notified of the decision of rejection by the Finnish tax authorities (compared to 5 years under the old legislation). In this sense, it is important to highlight that the taxpayer is deemed to be notified on the seventh day following the sending of the notice, unless the taxpayer can prove that he/she effectively received it at a later stage.
Any tax advice in this communication is not intended or written by KPMG to be used, and cannot be used, by a client or any other person or entity for the purpose of (i) avoiding penalties that may be imposed on any taxpayer or (ii) promoting, marketing, or recommending to another party any matters addressed herein.
The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavour to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation.