Entrepreneurs, corporations, partnerships and their joint owners as well as the people engaged in agriculture and forestry are subject to business taxation.
The profit of private business persons and self-employed persons is taxed as entrepreneur's income. The profit of a business partnership is taxed as income of the joint owners in accordance with the regulations on the taxation of joint owners of business partnerships. Corporations such as limited companies are taxpayers themselves, and they pay a corporation tax on their profit. A dividend paid by a corporation is taxed as income of the shareholders.
Corporation tax is an income tax paid by limited companies and other corporations. The tax rate is 20% of the corporation's taxable income. The taxable income of a corporation is calculated by subtracting the deductible expenses of the corporation from its taxable income.
In addition to limited companies, corporations that pay corporation tax also include the general government, cooperatives, associations, institutions, foundations and housing companies. The corporation tax liability of the general government, non-profit associations and institutions is limited to apply only to their business and real estate income. Generally, housing companies do not generate taxable income.
The state and municipalities are recipients of corporation tax. In tax year 2019 the state's permanent allotment ratio on the corporation tax is 68.7% and that of the municipalities 31.3%.