How to deduct car costs as a self-employed sole trader in Finland

Firstly, what is business use of a vehicle?

• Trips to places where the company has operations (fetching goods from a warehouse, visiting a client).

• Temporary trips outside the company’s regular area of operation. Read instructions on deducting the expenses for business travel here. (Cf. the employee’s daily allowances).
  
  

Other use of a vehicle is considered private use. For example, driving from home to work (the company’s place of business) is not considered business use. You can deduct the commuting expenses on your personal tax return.

1. There are two ways to deduct vehicle costs as a sole trader in Finland

As a sole trader, your vehicle falls into one of these categories:

A) Business Asset (Over 50% business use)

If more than half of your annual kilometres are work-related, your car is considered a business asset.

You can deduct:

• Fuel

• Maintenance & repairs

• Insurance

• Vehicle tax

• Depreciation
  
  

You must keep a driver’s log to show your business vs. private kilometres. Private use is added back in your tax calculation, meaning that the private use part can not be deducted as business expense.

B) Private Car Used for Business (≤ 50% business use)

If the car is mainly used for private purposes, you can still claim business kilometres using an additional deduction. In this scenario, the car is not considered a business asset.

The Tax Administration sets a yearly kilometre rate (e.g., €0.59/km in 2025). Check out our blog post on Entrepreneur business travel in Finland for more information about kilometre allowance.

You report:

• Total kilometres

• Business kilometres
  
  

The deductible amount is calculated for you.

2. What Your Driver’s Log Must Include

A trip log is essential for proving business use. The driver’s log must indicate the total kilometres driven in the vehicle during the tax year. With regard to business-related use, the log must contain the following information:

• start and end time of the trip

• start location, end location and, if necessary, the route driven

• kilometres driven

• purpose of the trip

• odometer reading at the start and end

• the driver of the car

• total kilometres driven in the car during the year.
  
  

Digital logs or simple spreadsheets work well as long as the required information is included.

3. Practical Tips

• Keep all car-related receipts.

• Record trips regularly to avoid guesswork.

• Review kilometres at year-end to choose the right deduction method.

• Always file business and private use correctly in MyTax.

Sole traders in Finland can deduct vehicle expenses efficiently when records are clear and deductions follow the Tax Administration's rules. Whether your car is a business asset or a private vehicle used occasionally for work, proper documentation ensures you claim what you’re entitled to — and avoid tax headaches later.

If you need help with your accounting or handling MyTax reporting, our accounting service can support you.

We're happy to help you with your accounting matters and instruct you on how to expense for the vehicle costs in your specific case. Book a 15 minute free consultation now or just give us a call!