Guide

#What the household expense tax credit means for your customer

The household expense tax credit means your customer can deduct part of the cost of work done in their home or holiday home from their own taxes. In practice, the work ends up costing the customer less than the invoice total suggests, since part of it comes back to them through taxation.

The credit amounts, deductible excess and conditions are confirmed annually, so it's not a good idea to promise exact figures to your customer off the top of your head. Direct your customer to check the current details on the vero.fi (Finnish Tax Administration) website, and see this year's situation summarized in our guide.

The credit is available to whoever pays for the work and whose home or holiday home the work is done in. Under certain conditions, work done in the home of one's own parents can also qualify, when the payer is the child. You don't need to know the details of your customer's taxes — it's enough to understand the basic principle and be able to point the customer toward the right information.

For your customer, the household expense tax credit is part of everyday financial planning: many people compare service providers precisely on whether the work qualifies for the credit and whether invoicing is handled in a way that makes claiming the credit easy. When you can explain this clearly, you lower the customer's threshold for hiring a professional. That's the whole point of the credit: to make legitimately purchased work more competitive and encourage households to buy services.

#What kind of work qualifies for the credit

Typical work that qualifies for the household expense tax credit includes home cleaning, window washing, maintenance and improvement work on homes and holiday homes — i.e. renovations — and yard work such as mowing the lawn, trimming hedges and clearing snow. These are exactly the bread-and-butter jobs for many light entrepreneurs, which is why the credit directly concerns your customers.

There are two important limitations to remember: the credit only applies to the labor portion, not materials or travel costs, and the work must take place in the customer's home or holiday home. For example, restoring a piece of furniture in your own workshop wouldn't qualify for the credit, even if the work itself is otherwise the same. Exact limitations can be found on the vero.fi website.

Not all work done in the home qualifies for the credit, however: new construction, for example, is excluded, and the boundaries shift along with legislation. That's why it's better to talk to your customer about the possibility rather than a certainty: explain that the work may qualify for the credit, and leave the final assessment to the customer and the Tax Administration.

Borderline cases come up often: does installing a home appliance qualify, what about building a fence or glazing a balcony? These aren't questions you should answer to a customer based on a hunch. The Tax Administration's website has a comprehensive list of work that does and doesn't qualify for the credit, and it's worth reviewing thoroughly once with your own service offering in mind. After that, you'll be able to answer the most common questions directly and refer rarer cases to vero.fi.

#How to use the household expense tax credit as a sales advantage

Many household customers don't think of the credit at the quote stage, which can make the price feel higher than it actually turns out to be. When you mention in your quote that the work qualifies for the household expense tax credit, you help the customer see the real cost and stand out from competitors who don't mention it.

Keep the message simple and honest: explain that the work may qualify for the household expense tax credit, and direct the customer to check their own situation on vero.fi. Don't promise exact amounts or calculate the customer's taxes for them, since the final credit amount depends on the customer's own tax situation.

A good way to phrase this in a quote is a short line next to the price: the labor portion of this invoice may qualify for the household expense tax credit — check your own situation at vero.fi. This one sentence makes your quote more informative than most competitors' and shows that you know the practices of your field. Many customers order additional work precisely because they remember the credit exists.

Remember to mention the credit to existing customers too: a cleaning customer might not know that window washing at home can also qualify for the same credit, and a renovation customer might have yard work done at the same time. The household expense tax credit is a natural way to suggest additional services without sounding pushy, because the suggestion brings the customer genuine benefit.

#What needs to appear on the invoice

For your customer to be able to claim the credit, the invoice must clearly separate the labor portion from materials and travel costs. The invoice must also include the invoicer's details and a description of the work performed. When you itemize the lines carefully, it's easy for the customer to report the information in their own tax return.

In the Truster app, itemizing invoice lines is easy: record the labor portion on its own line and materials on their own line. The household expense tax credit can also be claimed for work invoiced through an invoicing service, as long as the conditions for the credit are met. The customer claims the credit themselves, usually through OmaVero (the Tax Administration's online service), and needs your invoice details to do so.

Also let your customer know that the credit is generally applied to the tax year in which the invoice was paid, in case the timing matters to them. Encourage the customer to keep the invoice and payment receipt, since they'll need the information when claiming the credit. Your invoice serves as the customer's supporting document, so a carefully prepared invoice is also a form of customer service.

A typical example of a well-itemized invoice: a cleaning job invoice has its own line for the work done with hours worked, and its own line for materials used, and a renovation invoice separates labor, materials, and any travel costs from each other. When the lines are clear, the customer doesn't need to call you afterward asking for a breakdown, and you're spared from having to correct invoices. A clear invoice is also a business card: it tells the customer you handle things carefully, and encourages them to order from you again.

#Checklist for light entrepreneurs

Go through this before your next household customer: mention the household expense tax credit in your quote, itemize the labor portion separately from materials and travel costs on the invoice, direct the customer to vero.fi for the exact terms, and keep a record of the work done for yourself in case questions come up.

We compile up-to-date information on credit amounts and conditions in our annually updated overview, which you'll find in the guide's current-topics section. From there you can also share the link directly with your customer.

In the end, the household expense tax credit is a simple matter from your side: do the work well, itemize the invoice correctly, and tell the customer about the possibility. The rest is between the customer and the Tax Administration. When these three things are in order, the credit does quiet selling on your behalf year after year and brings you repeat customers.