Finland Supreme Administrative Court Clarifies VAT Rules for Factoring Services

The Finnish Supreme Administrative Court Feb. 6 posted online Decision No. KHO:2026:8, clarifying VAT rules for factoring services. The taxpayer, a company, provided invoice factoring and trade factoring services in exchange for commissions and fees. The Central Tax Board found that the taxpayer’s financing commission and limit fee, fast-payment fee, credit rating fee, and set-up fee were partly consideration for exempt financial services. After obtaining a preliminary ruling from the European Court of Justice (ECJ), the Supreme Administrative Court found that: 1) the taxpayer’s factoring activity was considered a VAT-taxable debt collection service, as the taxpayer argued; and 2) the ...