Jointly owned forests

A jointly owned forest is an area owned jointly by shareholder properties and used primarily for sustainable forestry for the benefit of its shareholders. A jointly owned forest can offer a good, functional solution for many of the objectives of modern forest ownership. 

The owners of the shareholder properties are shareholders of the jointly owned forest and form a joint forest partnership. Practical matters of the jointly owned forest, such as timber sales and maintenance, are handled by a management committee or administrator elected by the partnership.

Joint ownership is an easy way to own forest land. The governance model is functional and similar to that of a housing company, for example. Decisions are made by majority vote. 

Jointly owned forests are managed according to a forest management plan. Planned forest management ensures a steady and continuous yield. With regular fellings, shareholders do not receive large, one-off revenues from timber sales in the jointly owned forest. When a forest is managed as a larger unit, better prices can be obtained for timber, and the unit costs of purchases are lower.

Large areas also increase the possibilities for conservation, recreation and hunting. 

Jointly owned forests are taxed slightly lower than that of forests owned by private individuals. The surplus distributed by a jointly owned forest is tax-free income for the shareholders.

In principle, a jointly owned forest is suitable for almost all forest owners.

A large jointly owned forest is suitable for forest owners who do not feel the need to carry out forest work or make decisions on timber sales themselves. A large jointly owned forest is also well suited for those who want to invest in forests. 

A family-owned jointly owned forest is suitable for anyone who wishes to keep their forests in the family from one generation to the next. For a forest owner planning a generational transfer, a joint forest is an option worth considering. This ensures that the forest property remains intact and that the heirs’ ties to the family forest are preserved.

You can become a shareholder in a jointly owned forest by adding your forest to it. In return for the forest added, the new shareholder receives shares in the jointly owned forest. An area of a property or part of such an area may be added to a jointly owned forest.

You can also establish a jointly owned forest yourself, for example using forests owned by your family. However, you should not establish a jointly owned forest that is too small, as administrative costs make operating a small jointly owned forest not profitable.

A well-functioning joint forest continuously develops its operations, ensures good governance and monitors changes in its operating environment.

The development of a jointly owned forest may involve, for example, administration, forestry planning, financial monitoring, attracting new shareholders, communications or strengthening expertise. 

The operations of a jointly owned forest are regulated by the Act on Jointly Owned Forests. A jointly owned forest is private land and has no public law obligations.

The highest decision-making body of a jointly owned forest is the meeting of the joint forest partnership, which consists of the owners of the shareholder properties. The joint forest partnership is a separate legal person. Shareholders of a jointly owned forest may be private individuals, estates, partnerships or other legal entities. A shareholder’s voting rights and other rights depend on the size of the share. Decisions are made by majority vote.

Accounting obligations and taxation

A jointly owned forest is a separate taxpayer as a joint administration. Distributions from the surplus of a jointly owned forest are tax-exempt income for the shareholders. 

The capital income of a jointly owned forest is taxed at a fixed rate. The tax prepayment procedure applies.

A jointly owned forest is required to keep accounts. In addition, a jointly owned forest may be subject to an audit obligation under the Auditing Act.

The Finnish Forest Centre maintains the national register of jointly owned forests. The register contains public information on jointly owned forests.

For each jointly owned forest, a valid extract from the register and the forest's by-laws can be retrieved and downloaded free of charge.

The joint forest partnership must remember to regularly submit information on financial statements, changes in the governance of the jointly owned forest and its forest management plan to the register.

The resource bank for jointly owned forests contains guides, document templates and other materials to support the activities of jointly owned forests. The resource bank contains useful information on the administration of jointly owned forests, their expansion and the organisation of practical activities.

Metsään.fi

Persons authorised by a jointly owned forest can also start using the Metsään.fi service.
The Metsään.fi service

Tax Administration

Tax Administration guidance on the taxation of jointly owned forests
Vero.fi (in Finnish)

Suomen yhteismetsät ry

The website of the association of jointly owned forests (Suomen yhteismetsät ry) provides information and offers services for jointly owned forests.
Suomen yhteismetsät ry (in Finnish)

National Land Survey of Finland

The National Land Survey of Finland is responsible for jointly owned forest surveys and also provides statistics on jointly owned forests in Finland, among other things.
Maanmittauslaitos.fi (in Finnish)

• Join a jointly owned forest (in Finnish)
• Search for an expanding jointly owned forest(in Finnish)
• Register of jointly owned forests (in Finnish)
• Development of a jointly owned forest (in Finnish)
• Information on jointly owned forests to be submitted to the Finnish Forest Centre (in Finnish)
• Frequently asked questions about jointly owned forests (in Finnish)
• Material bank for jointly owned forests (in Finnish)