Abstract. In peatlands drained for forestry, the soil carbon (C) or carbon dioxide (CO2) balance is affected by both (i) higher heterotrophic CO2-C release from faster decomposing soil organic matter (SOM) and (ii) higher plant litter C input from more vigorously growing forests. This balance and other greenhouse gas (GHG) sinks and sources in managed lands are annually reported by national GHG inventories to the United Nations Climate Change Convention. In this paper, we present a revised, fully dynamic method for reporting the CO2 balance of drained peatland forest soils in Finland. Our method can follow temporal changes in tree biomass growth, tree harvesting and climatic parameters, and it is built on empirical regression models of SOM decomposition and litter input in drained peatland forests. All major components of aboveground and belowground litter input from ground vegetation as well as live trees and trees that died naturally are included, supplemented by newly acquired turnover rates of woody plant fine roots. Annual litter input from harvesting residues is calculated using national statistics of logging and energy use of trees. Leaching, which also exports dissolved C from drained peatlands, is not included. The results are reported as time series from 1990–2021 following the practice in the GHG inventory. Our revised method produces an increasing trend of annual emissions from 0.2 to 2.1 t CO2 ha−1 yr−1 for the period 1990–2021 in Finland (equal to a trend from 1.4 to 7.9 Mt CO2 yr−1 for the entire 4.3 Mha of drained peatland forests), with a statistically significant difference between the years 1990 and 2021. Across the period 1990–2021, annual emissions are on average 1.5 t CO2 ha−1 yr−1 (3.4 Mt CO2 yr−1 for 2.2 Mha area) in warmer southern Finland and −0.14 t CO2 ha−1 yr−1 (−0.3 Mt CO2 yr−1 for 2.1 Mha area) in cooler northern Finland. When combined with data on the CO2 sink created by the growing tree stock, in 2021 the drained peatland forest ecosystems were a source of 1.0 t CO2 ha−1 yr−1 (2.3 Mt CO2 yr−1) in southern Finland and a sink of 1.2 t CO2 ha−1 yr−1 (2.5 Mt CO2 yr−1) in northern Finland. We compare these results to those produced by the semi-dynamic method used earlier in the Finnish GHG inventory and discuss the strengths and vulnerabilities of the new revised method in comparison to more static emission factors.