TaigaTrust

EOR vs Subsidiary in Finland: What Is the Better Choice?

When entering Finland, foreign companies usually choose between:
  1. Opening a subsidiary
  2. Using an Employer of Record
Let’s compare both models.

1. Legal Structure

Criteria
EOR
Subsidiary
Legal entity required
No
Yes
Employer registration
Handled by EOR
Required
Corporate tax filing
No
Yes

2. Cost Structure

EOR:
  • Monthly service fee
  • Employer contributions included
  • No corporate accounting obligations
Subsidiary:
  • Incorporation costs
  • Accounting & auditing
  • Corporate income tax (20%)
  • Ongoing compliance expenses

3. Risk Level

  • Subsidiary creates immediate tax presence in Finland.
  • EOR may reduce permanent establishment risk if properly structured.

4. When to Choose EOR

  • Market testing
  • Short-term projects
  • Hiring 1–5 employees
  • Avoiding corporate setup

5. When to Choose a Subsidiary

  • Long-term presence
  • Large workforce
  • Physical operations
  • Significant turnover in Finland

Final Thought

EOR is a strategic entry tool.
Subsidiary is a long-term investment.
The right choice depends on scale, duration and tax structure.
2026-02-11 11:33