Households as employers
When you hire a cleaner, renovator, nanny, au pair or some other employee to work at your house or cottage, you become an employer. You need to take care of the pension cover of these employees.
Households’ obligations as employers
When you hire an employee as a household employer, insure the employee with employees’ pension insurance, i.e. TyEL insurance. By doing that you arrange pension cover for your employee. That is why the insurance is statutory, in other words mandatory. The employment relationship is insured under TyEL if the employee is 17–67 years of age and if you pay him or her more than EUR 61,37 per month (60.57 in 2020).
As a household employer you can be a contract employer or a temporary employer. Which you are depends on how much you pay your employee in wages and whether you continuously employ employees under an employment contract.
You can be a contract employer or a temporary employer
If you continuously employ at least one employee you are a contract employer. In that case, take out TyEL insurance. Take out the insurance when your employment relationship starts or at the latest when you calculate the employee’s wages and pay them. You need to report your employee’s wages to the Incomes Register, and you will need a TyEL insurance number, i.e. a pension policy number for submitting the report.
If you have a fixed-term employee whose payroll for six months is less than EUR 8,790 (8,676 in 2020), you are a temporary employer. You do not need to take out TyEL insurance; all you need to do is to report the wages to the Incomes Register as a temporary employer. Select Ilmarinen’s employment pension insurance company code 46 when making an earnings payment report.
Report the salaries and wages you have paid to the Incomes Register
Report all the salaries and wages you have paid to the Incomes Register regardless of how large the pay is or whether you have withheld tax from the pay. Report the paid wages to the Incomes Register even if the payroll is less than the TyEL insurance limit. The Tax Administration, Ilmarinen, companies providing workers’ compensation insurance and the Employment Fund receive data on paid wages and salaries from the Incomes Register. Read more about reporting earnings data to the Incomes Register.
When should earnings payment reports be made?
When you submit an earnings payment report to the Incomes Register depends on how many employees you have.
Usually, households must submit to the Incomes Register the earnings payment report and the employer’s separate report on the wages and salaries paid at the latest on the fifth day of the calendar month following the wage payment month. If, for example, you paid wages in May, submit the report to the Incomes Register at the latest on the 5th of June.
If you employ more than one permanent employee or more than five fixed-term employees during the calendar year, register your household with the Tax Administration’s employer register. Submit the earnings payment report to the Incomes Register within five days of the date on which the earnings were paid. Also submit the employer’s separate report. Do this once a month, also for the months during which you do not pay wages or salary.
Househoulds' payroll services
You can calculate the employee’s pay and take care of all statutory payments in one go in the Palkka.fi or Oima services. These services automatically send the earnings payment data to the Incomes Register. Read more about the payroll services.
Hiring an au pair
Are you planning on hiring a foreign au pair to help you around the house and in childcare? Hiring an au pair creates an employment relationship, so it is a good idea to sign a written contract with the au pair, which includes the employment terms.Read more about hiring an au pair
When is it not necessary to pay the TyEL contribution?
You do not need to pay the TyEL contribution or take out TyEL insurance when you buy a service from a self-employed person or company. You must, however, find out whether the seller of the service, i.e. the company, is part of the Tax Administration’s Prepayment Register.
If the seller of the service, for example a self-employed person, is part of the Prepayment Register, all you have to do is pay the invoice from the service provider/seller. In addition, you can receive tax credit for domestic expenses, if the conditions for the tax credit are met.
If the seller is not registered in the Prepayment Register, you should collect the tax and report the compensation for work to the Incomes Register. You cannot receive the tax credit for domestic expenses because the service seller is not registered in the Prepayment Register.
The TyEL insurance is also not necessary if the employee you hire is aged under 17, or 68 or over or you pay him or her less than EUR 61.37 per month (60.57 in 2020).