Finnish households to receive higher tax deductions for home services under new rules

The Finnish government has increased tax deductions for household services, raising the maximum benefit to €2,100 and the deduction rate to 40%, Yle reports. The changes, reversing a planned cut, will take effect later this year.

The new rules raise the deduction cap from €1,600 to €2,100, with eligible costs now covered at 40% (up from 35%). The full benefit applies to expenses just under €5,600—previously, the limit was reached at around €5,000 in service costs.

The adjustment returns the deduction to near 2021 levels after a proposed reduction for 2025 was scrapped. Originally introduced to combat undeclared work and boost employment in cleaning and renovation sectors, the subsidy had faced criticism for failing to deliver expected social benefits, according to research by the Government Institute for Economic Research (VATT) and Pellervo Economic Research (PT).

The deduction applies to care, cleaning, and home renovation services. A calculator published by Yle allows households to estimate their savings under the new terms.