Limited liability company (Oy) in Finland 2026 - setup, taxation and obligations

Table of Contents

1. Short answer: what is a Finnish limited liability company?
2. When does an Oy make sense?
3. Setting up an Oy in 2026
4. How much does it cost to set up an Oy?
5. Taxation of an Oy in 2026
6. Bookkeeping, financial statements and filings
7. Advantages and disadvantages of an Oy
8. Sole trader or limited liability company?
9. Checklist before registration
10. Summary

1. Short answer: what is a Finnish limited liability company?

Osakeyhtiö, usually shortened to Oy, is the Finnish limited liability company form. The company is a separate legal entity from its owners. In practice, this means that an Oy can sign contracts, own assets, employ people, apply for financing and be responsible for its own debts.

The owners, known as shareholders, are generally not personally liable for the company’s debts with their private assets. This is the biggest difference compared with a Finnish sole trader, where the entrepreneur and the business are financially the same person.

In 2026, a private limited liability company in Finland can still be established without any minimum share capital. The company exists only after it has been entered in the Finnish Trade Register.

If you want help with setup, registrations and bookkeeping, see bisse.fi’s limited company setup and accounting service.

2. When does an Oy make sense?

An Oy is not automatically the best choice for every new entrepreneur. It is especially useful when the business involves growth, risk, multiple owners or a need to separate company money clearly from personal money.

Consider an Oy if:

• revenue or profit is growing and combining salary and dividends may become useful
• the business carries contract, debt or liability risks
• you plan to hire employees
• you are founding the company with another person or an investor
• you want to build company equity and net assets over time
• larger customers, financiers or partners expect a clear company structure
• you may later sell the business or bring in new owners

For small part-time service work, a sole trader setup or light entrepreneurship may be simpler. An Oy brings more administration, but it also gives a stronger structure for growth and risk management.

3. Setting up an Oy in 2026

An Oy is usually set up online through the Finnish Business Information System, YTJ. The process works like this:

1. Decide the basics

Before filing the registration, decide at least:

• company name
• line of business
• domicile, meaning the Finnish municipality where the company is based
• shareholders and share ownership
• board members and any deputy board member
• financial year
• possible managing director
• whether an auditor is needed

If you set up the company alone, you are usually the only shareholder and the ordinary board member. If the board has fewer than three ordinary members, the company must also have at least one deputy member.

2. Choose the guided setup package or your own filing

YTJ has two main options:

1. Guided setup package. This suits a standard small Oy where share capital is 0 euros, the shares have no subscription price, all shareholders are adults, the persons being reported have Finnish personal identity codes and the standard articles of association are enough.
2. Registration with your own documents. This is needed, for example, if the company has share capital, a shareholder is another company, not all persons have Finnish personal identity codes or the articles of association need special clauses.

The guided package creates the memorandum of association and articles of association for you. If you use your own documents, you prepare them yourself and attach them to the registration.

3. Prepare the memorandum and articles of association

The memorandum of association records the decision to establish the company. It includes details such as shareholders, shares, board members, financial year and any auditor or managing director.

The articles of association can be very short. At minimum, they state the company name, domicile and line of business. If there is more than one shareholder, it is often worth preparing a separate shareholders’ agreement. A shareholders’ agreement is not filed with the Trade Register, but it can prevent disputes over work input, share transfers and decision-making.

4. Register the company within three months

The Oy must be filed for registration within three months of signing the memorandum of association. Otherwise, the incorporation lapses.

During setup, you also register for the relevant Finnish Tax Administration registers, such as the prepayment register, VAT register and employer register, if your company needs them.

Remember the beneficial owner details as well. In practice, these are the people who own or control the company.

4. How much does it cost to set up an Oy?

The Finnish Patent and Registration Office’s 2026 processing fees for setting up an Oy are:

• 300 euros if you use YTJ’s guided setup package
• 400 euros if you file the registration with self-prepared documents

A private limited liability company has no minimum share capital requirement. You can therefore set up the company with 0 euros of share capital if that suits your situation.

In addition to the registration fee, budget for:

• business bank account opening and monthly bank fees
• bookkeeping software or an accounting firm
• financial statements and corporate tax return
• possible payroll
• insurance
• industry-specific permits
• possible expert help with articles of association, shareholders’ agreement or tax planning

If you want setup, bookkeeping and official filings in one service, see bisse.fi’s limited company service.

5. Taxation of an Oy in 2026

An Oy is a separate taxpayer. In 2026, the Finnish corporate income tax rate is 20% of the company’s taxable profit.

An owner-entrepreneur can usually take money from the company in two ways:

1. Salary. Salary is a deductible expense for the company and earned income for the entrepreneur.
2. Dividends. Dividends are distributed from the company’s after-tax profit, and the tax treatment depends on the company’s net assets and the amount of dividend.

For dividends from an unlisted Finnish company, the key threshold is 8% of the mathematical value of the shares. If the dividend is no more than 8% of that value and the shareholder’s total dividends from all unlisted companies are no more than 150,000 euros per year, 25% of the dividend is taxable capital income and 75% is tax-exempt. If the dividend exceeds the 8% threshold, the excess is mainly taxed as earned income.

This does not mean that an Oy is always the most tax-efficient option. The benefit usually appears only when profit remains in the company after salary and the company builds net assets. If all profit is immediately taken for personal use, a sole trader setup may be simpler.

Also remember that company funds cannot be used freely for personal expenses. Company money and owner money must be kept separate. Salary, dividends, fringe benefits, shareholder loans and reimbursements paid to the owner must be handled correctly in bookkeeping and taxation.

VAT and other tax registers

If the company sells VAT-liable goods or services and its turnover exceeds the small-scale VAT threshold, it must register for VAT. In Finland in 2026, the threshold is 20,000 euros per calendar year, and the previous calendar year’s turnover also affects the assessment.

Joining the prepayment register is usually recommended for service companies, because it tells customers they do not need to withhold tax from purchased work. The employer register is needed if the company pays wages regularly.

6. Bookkeeping, financial statements and filings

An Oy must always use double-entry bookkeeping. The company must prepare financial statements for every financial year, even if there has been little or no activity.

Key deadlines:

• Tax return: usually filed within four months after the end of the financial year.
• Annual general meeting: held within six months after the end of the financial year.
• Financial statements to the Trade Register: filed within eight months after the end of the financial year.

Since 2025, PRH has charged late filing fees if a limited liability company does not file its financial statements with the Trade Register on time. This also applies to companies with no activity.

A small Oy does not always need to appoint an auditor, but the obligation depends on the company’s size and circumstances. Check the audit requirement at the setup stage, especially if you apply for public support, have several shareholders or a financier requires an audit.

7. Advantages and disadvantages of an Oy

Advantages

• Limited liability. The owner is generally not personally liable for company debts.
• Clear financial separation. Company money, debts and contracts are separate from the owner’s personal finances.
• Growth structure. Shares can be split between several owners, and bringing in investors is easier than with a sole trader business.
• Salary and dividend combination. When the company is profitable, an owner-entrepreneur can plan income withdrawals more flexibly.
• Credibility. The Oy form can help with larger contracts, financing and partnerships.

Disadvantages

• More administration. Bookkeeping, financial statements, annual general meeting and official filings require discipline.
• Higher running costs. Accounting, banking, software and possible payroll cost more than in a simple sole trader setup.
• Money withdrawals are stricter. The owner cannot withdraw money freely without salary, dividend or other tax treatment.
• Closing the company is more work. An Oy cannot simply be left unused like a sole trader business. Ending it usually requires liquidation or another formal process.

8. Sole trader or limited liability company?

A sole trader setup is often best for a solo entrepreneur whose activity is small, risks are low and money is meant to be taken directly for personal use.

An Oy is usually better when:

• the company has, or will have, more than one owner
• profits are meant to stay in the company for growth
• the business has greater contract or liability risks
• the goal is to hire employees
• the company should build its own net assets
• you want to keep personal and company money clearly separate

Rule of thumb: if you do small service work alone, a lighter setup often works at first. If your goal is to build a growing company, employ people or optimize the overall salary and dividend mix, take the Oy option seriously from the start.

9. Checklist before registration

Before setting up an Oy, go through these questions:

1. Is an Oy the right business form, or would a sole trader setup or light entrepreneurship be enough?
2. Is the company name available and distinctive?
3. Is the line of business broad enough but still clear?
4. Who owns the shares and in what proportions?
5. Do you need a shareholders’ agreement?
6. Who sits on the board, and is a deputy member needed?
7. Will the company appoint a managing director?
8. What is the financial year?
9. Are VAT, prepayment or employer registrations needed?
10. How will bookkeeping, payroll and financial statements be handled?
11. How will the owner-entrepreneur take money: salary, dividends or both?
12. Is YEL pension insurance needed for the owner-entrepreneur?

If you want to go through these with an expert, bisse.fi’s limited company service helps with registration and getting the company’s financial administration started.

10. Summary

In 2026, an Oy is a strong choice for an entrepreneur who wants to build a separate, scalable and professional company. A private limited liability company can be established without minimum share capital, but that does not make it administratively light.

The key points:

• an Oy exists only after Trade Register registration
• PRH’s guided setup package costs 300 euros, and a filing with self-prepared documents costs 400 euros
• corporate income tax is 20% in 2026
• company money and owner money must be kept separate
• financial statements, tax return and annual general meeting are yearly obligations
• an Oy is especially useful when the business grows, risk increases or there is more than one owner

Need help? See bisse.fi’s limited company setup and accounting service.

Sources: PRH: setting up a limited liability company, Suomi.fi: setting up a limited liability company, Finnish Tax Administration: income taxation of limited liability companies, Finnish Tax Administration: dividends from an unlisted company and PRH: filing financial statements. This article is general information, not legal or tax advice. Check current official guidance before making decisions.