Need help communicating with the Finnish tax authorities? 

The accounting and consulting company Leinonen started operating in Estonia in 1993 as one of the first foreign-owned accounting companies in the Baltic States. Today, the Tallinn office employs more than 40 people and serves more than 350 companies operating in Estonia and Finland, from individual entrepreneurs to large multinational corporations.

“The basic principle of our operation is to offer quality service and reliable competence at a fair price, giving our clients the opportunity to focus on their core business,” says Kaire Rebane, the head of Leinonen’s Tallinn office. “In addition to Estonian services, we have been offering Finnish accounting, payroll, and reporting services from the Tallinn office for over ten years. Our accountants communicate in Finnish and can communicate on behalf of clients with the tax authorities or with the clients’ employees located in Finland.”

“We like to help clients from the beginning, to think through together what their goals and plans are in their business in Finland, what should be kept in mind when working in the respective field of business, whether to work in Finland as an Estonian company or to establish a Finnish company immediately. It is important to follow the peculiarities of Finnish payroll and tax accounting and reporting requirements, access to reporting systems, and communication with the tax authorities,” Rebane lists.

Communication with the Finnish tax authorities occurs a little differently than what an Estonian is used to in his own country. As a rule, the Finnish tax authorities send the information by ordinary letter and set deadlines for replying. However, if an operating Estonian company has a postal address in Finland, for example, in a place that it does not visit very often, the response time to the letter may be too short. Through Leinonen’s Finnish office, it is possible to get an address service, which includes scanning and sending e-mails to an agreed-upon e-mail address when the letters arrive, so that the information can be forwarded quickly and there is enough time to react.

Leinonen also offers assistance if you want to set up a Finnish company or register in the necessary tax registers. “We help to draw up employment contracts, do accounting and payroll, and prepare and submit monthly and annual reports to Finland. The topics about which our clients often turn to us in connection with Finnish accounting are mostly questions about payroll, especially the interpretation of collective agreements. Due to local law, companies often have established permanent locations in Finland, of which the client perhaps is not aware before receiving a letter from the tax authorities. But then there are often financial requirements in this regard. There are many nuances with which we can familiarize entrepreneurs and help them,” explains Rebane.

The emergency situation brought our clients closer and brought new people in need

Since the emergency situation began in mid-March this year, all of our lives have changed – so in Leinonen, where work has been organized in home offices and where, if desired, people can also work partially from office, keeping distance. Rebane states that flexibility, taking into account the wishes of employees, and permanently guaranteeing the high quality of work are important. “Thanks to our operative and smooth move to home offices, we were able to continue daily customer service problem-free. This period of isolation also had a good effect on some of our clients, from whom we finally agreed to accept electronically submitted documents. As a rule, we avoid paper media; we also print out documents ourselves only when absolutely necessary.”

She adds that during telework, the values of the company, the fulfilment of promises made to our clients, the satisfaction of employees, and principles of environmental friendliness are still followed. “The emergency situation brought us even closer to our clients. Clients needed more legal assistance in both employment law and restructuring – mergers, divisions and restructuring, and closures of the companies.”

Due to the emergency situation, Leinonen has been approached by several new clients who have eliminated in-house accountant positions. “In today’s economically difficult situation, it has become a trend to buy an accounting service from a company that provides it,” says the head of the Tallinn office. “This saves a lot of costs, because the company does not have to provide the accountant with a real workplace, pay a permanent salary, or pay for competency training. Instead, the service is paid on the basis of volume; in addition to accounting, we also provide legal and tax support as a complex service to solve more difficult situations.”

Accounting is far more than just making entries

Accounting is not just debit-credit, which means that the accountant only makes entries. In order to make accounting entries and tax returns properly, the accountant must be able to read legal documents and be familiar with various laws and their amendments. “In order to ensure the high quality of our accounting, in addition to accountants we have people in-house who specialize in business law and tax law. The advisory team supports accountants in their daily work and also advises clients directly. Customers often assume that an accountant is a jack-of-all-trades who should know everything about, for example, a company’s restructuring options, consequences related to tax legislation and its correct presentation, et cetera. This is too much to expect from one accountant – but our good team provides the client with the full range of services,” says Rebane.

According to her, customers often expect an accountant to formalize the employee’s employment contract, dismissal, etc. “But such labour law issues are also extremely sensitive and need the intervention of a person with extensive knowledge in the respective field. Here our legal advisers can help. In addition to the legal formalization of employment contracts and appendices, we prepare internal rules of procedure and train our clients’ employees on the spot regarding employment law; we also negotiate with employees on behalf of the client when the client desires to make changes to employment contracts.”

Today, the prevention of money laundering and terrorism and the personal data protection laws are very topical issues; here, too, Leinonen’s employees advise their clients, develop the company’s internal rules, and check the compliance of company processes.

Common errors to prevent or correct for which one should turn to Leinonen:

• Cross-border movements of goods may cause a tax liability in another country.
• Insufficient documentation (e.g. incomplete supporting documents, non-registration of business trips), which may lead to tax liabilities.
• Lack of knowledge of local law and practice, which usually results in tax liability.
• Incorrect formalization of concluding, amending, and terminating employment contracts.
• Inadequate planning of customers’ transactions and incorrect preparation of documents.

What are the benefits of hiring a tax and legal advisor for our accounting clients?

Although one accountant alone cannot cover all issues, according to Rebase it is worthwhile for a client to turn to Leinonen with any of its concerns. “If we do accounting for a client, and they should have a subsequent tax or other legal issue, the advisor will receive a lot of background information on the issue from the in-house accountant. In other words, before the client is involved, there has already been a quick exchange of information within the company, which ensures a smoother counselling service for the client. For example, a change in a client’s business model may not only mean a change in accounting, but it may also mean an impact on tax accounting.”

Leinonen’s accountants always become aware of changes in the law in a timely and thorough manner, and part of the process when they are sent complex legal documents, in line with good practice, is for the accountant to consult an in-house legal adviser. “Thanks to this, we always consider and apply all legal requirements arising from the specifics of the client’s business model. Involving an advisor also helps to serve companies with an international background and grow more consciously – because in practice, cross-border transactions raise the most questions, such as issues related to VAT taxation and to the taxation of cross-border employees,” explains Rebane. “Advising customers, defining their risks and finding the information they need in connection with their activities in Finland or in another country of the European Union is also more comprehensive and with extra value for the customer thanks to our consulting team.”

Leinonen Group offers accounting and consulting services in 12 countries

Petteri Leinonen Photo: Rob Orthen

  Leinonen Group is an accounting and consulting company; it was founded in 1989 in Finland by Petteri Leinonen. The company has grown and developed step by step, in cooperation with its very diverse and demanding clients, for over 30 years. At present, Leinonen Group offers its services through 14 offices in 12 countries; it is represented not only in the Baltic States and Finland but also in Sweden, Norway, Poland, Hungary, Bulgaria, Ukraine, Belarus, and Russia.

The head office, which unites all Leinonen Group offices and coordinates cooperation, is located in Tallinn. Leinonen’s service standards have been created to provide the best customer service. Various business software is used every day, and the working languages ​​in the Estonian office are Estonian, English, Finnish, and Russian. The quality of Leinonen’s Estonian office service is confirmed by the ISO 9001:20015 quality certificate awarded by Bureau Veritas.