Estimates of Sun-Induced vegetation chlorophyll Fluorescence (SIF) using remote sensing techniques are commonly determined by exploiting solar and/or telluric absorption features. When SIF is retrieved in the strong oxygen (O2) absorption features, atmospheric effects must always be compensated. Whereas correction of atmospheric effects is a standard airborne or satellite data processing step, there is no consensus regarding whether it is required for SIF proximal-sensing measurements nor what is the best strategy to be followed. Thus, by using simulated data, this work provides a comprehensive analysis about how atmospheric effects impact SIF estimations on proximal sensing, regarding: (1) the sensor height above the vegetated canopy; (2) the SIF retrieval technique used, e.g., Fraunhofer Line Discriminator (FLD) family or Spectral Fitting Methods (SFM); and (3) the instrument's spectral resolution. We demonstrate that for proximal-sensing scenarios compensating for atmospheric effects by simply introducing the O2 transmittance function into the FLD or SFM formulations improves SIF estimations. However, these simplistic corrections still lead to inaccurate SIF estimations due to the multiplication of spectrally convolved atmospheric transfer functions with absorption features. Consequently, a more rigorous oxygen compensation strategy is proposed and assessed by following a classic airborne atmospheric correction scheme adapted to proximal sensing. This approach allows compensating for the O2 absorption effects and, at the same time, convolving the high spectral resolution data according to the corresponding Instrumental Spectral Response Function (ISRF) through the use of an atmospheric radiative transfer model. Finally, due to the key role of O2 absorption on the evaluated proximal-sensing SIF retrieval strategies, its dependency on surface pressure (p) and air temperature (T) was also assessed. we combined simulated spectral data with p and T measurements obtained for a one-year period in the Hyytiala Forestry Field Station in Finland. Of importance hereby is that seasonal dynamics in terms of T and p, if not appropriately considered as part of the retrieval strategy, can result in erroneous SIF seasonal trends that mimic those of known dynamics for temperature-dependent physiological responses of vegetation.