Nokia 2007 Annual Report Download - page 134

Finnish Capital Taxes
The Finnish capital tax regime was abolished in the beginning of 2006.
Finnish Transfer Tax
Transfers of shares and ADSs could be subject to the Finnish transfer tax only when one of the parties
to the transfer is subject to Finnish taxation under the Finnish Income Tax Act by virtue of being a
resident of Finland or a Finnish branch of a nonFinnish credit institution. In accordance with the
amendments in the Finnish Transfer Tax Act (applicable as of November 9, 2007) no transfer tax is
payable on the transfer of shares or ADSs (irrespective of whether the transfer is carried out on stock
exchange or not). However, there are certain conditions for the exemption. Prior to the said
amendments, transfer tax was not payable on stock exchange transfers. In cases where the transfer
tax would be payable, the transfer tax would be 1.6% of the transfer value of the security traded.
Finnish Inheritance and Gift Taxes
A transfer of an underlying share by gift or by reason of the death of a US Holder and the transfer of
an ADS are not subject to Finnish gift or inheritance tax provided that none of the deceased person,
the donor, the beneficiary of the deceased person or the recipient of the gift is resident in Finland.
NonResidents of the United States
Beneficial owners of ADSs that are not US Holders will not be subject to US federal income tax on
dividends received with respect to ADSs unless this dividend income is effectively connected with the
conduct of a trade or business within the United States. Similarly, nonUS Holders generally will not
be subject to US federal income tax on the gain realized on the sale or other disposition of ADSs,
unless (a) the gain is effectively connected with the conduct of a trade or business in the United
States or (b) in the case of an individual, that individual is present in the United States for 183 days
or more in the taxable year of the disposition and other conditions are met.
US Information Reporting and Backup Withholding
Dividend payments with respect to shares or ADSs and proceeds from the sale or other disposition of
shares or ADSs may be subject to information reporting to the IRS and possible US backup
withholding at the current rate of 28%. Backup withholding will not apply to a Holder, however, if the
Holder furnishes a correct taxpayer identification number or certificate of foreign status and makes
any other required certification or if it is a recipient otherwise exempt from backup withholding (such
as a corporation). Any US person required to establish its exempt status generally must furnish a duly
completed IRS Form W9 (Request for Taxpayer Identification Number and Certification). NonUS
Holders generally are not subject to US information reporting or backup withholding. However, such
Holders may be required to provide certification of nonUS status (generally on IRS Form W8BEN) in
connection with payments received in the United States or through certain USrelated financial
intermediaries. Backup withholding is not an additional tax. Amounts withheld as backup
withholding may be credited against a Holder’s US federal income tax liability, and the Holder may
obtain a refund of any excess amounts withheld under the backup withholding rules by filing the
appropriate claim for refund with the Internal Revenue Service and furnishing any required
information.
Changes in Income Tax Convention between Finland and the US
There have been recent amendments to the tax convention between Finland and the US that may
effect our US Holders. The most relevant of these amendments relates to the elimination of
withholding taxes on dividend payments for qualifying pension funds. The elimination of withholding
taxes on dividends became effective retroactively with regard to dividend income on or after
January 1, 2007. US Holders are urged to consult their tax advisors regarding these changes.
133