Determining the TyEL contribution

The size of your earnings-related pension contribution depends on your size as an employer and the client bonuses you receive. Read more about how the TyEL contribution is determined and its size on this page.

What does the TyEL contribution consist of?

Your TyEL contribution is affected by the following:

  • Your size as an employer
  • The client bonuses you receive 
  • A company-specific administrative cost
  • As a large employer, your contribution is also impacted by other discounts and your employees’ work ability.

The Ministry of Social Affairs and Health annually confirms the principles for calculating the earnings-related pension contribution.

  1. The basic TyEL contribution was reduced for the rest of the year 2020 due to the coronavirus pandemic in spring 2020. The reduction reduced the employer’s share of the TyEL contribution by 2.6 percentage points of the wages and salaries paid between 1 May and 31 December 2020. The corona discount will be compensated for in 2022-2025 by raising the employer’s share of the TyEL contribution. Year 2024 the repayment raises the employer’s share of the TyEL contribution by 0.41 percentage points (0,44 in 2023). 

Average TyEL contribution

The average TyEL contribution is a contribution percentage that takes into account the average client bonus of the whole earnings-related pension sector and other contribution discounts. The average TyEL contribution is 24.85% in 2025 (24.81% in 2024).

Basic TyEL contribution and average TyEL contribution in 2024 and 2025

TyEL contribution 2024, % of payroll 2025, % of payroll
Average TyEL contribution 24.81 24.85
Basic TyEL contribution 25.12** 25.28*

* The percentage does not take into account company-specific administrative cost. For contract employers the administrative cost will be a maximum of around 0.18 % of the payroll in 205, and 0.20 % in 2024.

**Ilmarinen's administrative costs have been taken into account in the small employer's contribution percentage.

Components of the TyEL contribution

The TyEL contribution you pay consists of six different components. The various components are used to finance different types of pension, such as old-age and disability pensions. They are also used to finance pension administration and cover contribution losses and other expenses.

The largest of the six components of the TyEL contribution is the pooled component that is used to finance, for example, old-age pensions and the index increments of all pensions. The largest part of the TyEL contribution is used to pay current pensions. Around one fifth of the contribution is funded for future pensions.

Components of the basic TyEL contribution on average in 2025

 Component What is financed with the component What affects the size of the component % of payroll
Old-age pension Old-age pensions,funded portion Age and gender of employee 3.67
Disability pension Disability pension and maintaining work ability Age of employee and own disability pensions
(size of employer)		 0.7
Pooled component Old-age pensions (unfunded component), years of service pensions,part-time pensions, survivors pensions, rehabilitation increments, index increments on pension etc Age and gender of employee 20.24
Other Contribution losses, administrative costs and statutory payments, and expenses of the Finnish Centre for Pensions, judicial administration charges,supervision charges of the Financial Supervisory Authority Size of employer 0.74
Estimated client bonuses   The customer rebate is a payment discount for the employer and it depends on the earnings of the occupational pension institution's investments. Customer rebates are paid to contractual employers. -0.5
Average insurance contribution     24.85

 

  1. As an employer, you collect your employee’s share of the contribution from his or her pay and pay us the entire TyEL contribution.

    The employee’s share of the contribution is the same regardless of his or her age. An exception to this is the contribution share of employees aged 53–62 years, which is larger than for other employees. Employees between the ages of 53 and 62 also accrue more pension. The higher contribution share is applied to employees starting at the beginning of the month following their 53rd birthday until the end of the month in which they turn 63. This practice of a higher contribution share and larger pension accrual will continue during the transitional period which will end at the end of 2025.  

    Employee’s share of the TyEL contribution by age group in 2024 and 2023

    Employee's share of contribution 2024, % of pay 2023, % of pay
    Employee 17-52 years old 7.15 7.15
    Employee 53-62 years old 8.65 8.65
    Employee 63-67 years old 7.15 7.15

     

    Withhold the employee’s contribution from his or her pay also when

    • your employee receives pension in addition to the pay
    • you have taken out voluntary TyEL insurance for the employee for work abroad or a position of trust
    • you have taken out voluntary insurance for the employee even if his or her pay falls below the TyEL lower limit. Your obligation to insure starts when you pay an employee at least EUR 68.57 per month in 2024, or when you paid him or her EUR 65.26 per month in 2023

    Report all the salaries and wages you have paid to the Incomes Register. 

Client bonus

The client bonus reduces your pension contribution. It is based on Ilmarinen’s solvency and the efficiency of our operations. Our solvency is affected by our investment income and our efficiency by the way we operate.

You receive the client bonus when your TyEL insurance is in force with Ilmarinen and you are a so-called contract employer. Insurance that has ended on the last day of the year also receives a bonus. You start receiving bonuses in the second year after your insurance with Ilmarinen has begun.

You receive the bonus early each year.

If you transfer your insurance from Ilmarinen to another pension company, you may receive an additional bonus if the conditions are met. You will receive it for a maximum of three years after your insurance has ended. The additional bonus is smaller than the client bonus.

The client bonus reduces the TyEL contribution for 2024 by an average of 0.4 per cent (0.6 per cent in 2023). If you have been insured with Ilmarinen for a long time, your bonus may be substantially larger.

The amounts of client bonuses have been determined in the earnings-related pension companies’ joint calculation principles. Each earnings-related pension company has its own calculation principles, which specify how the client bonuses are allocated across the different policies. The bonus model specified in Ilmarinen’s calculation principles is based on the insurance payroll. The Ministry of Social Affairs and Health annually confirms the earnings-related pension companies’ joint calculation principles and each pension company’s own principles.

  1. The more you have paid wages, the larger your client bonus. In Ilmarinen’s bonus model your client bonus is affected by two payroll amounts: your company’s payroll for the previous year and total payroll for a maximum of 20 preceding years. If your company belongs to a group, your bonus also depends on the group’s payroll. The payroll only includes the employment relationships insured with Ilmarinen.

    In our bonus model, the duration of your insurance, the total payroll for a maximum of 20 years, affects the part of the bonus granted based on solvency. We distribute the surplus resulting from efficient operations based on the previous year’s payroll.

    The client bonus you receive in 2025 is based on Ilmarinen’s solvency and operational efficiency in 2024.

Administrative cost at Ilmarinen

As of the start of 2023, the contributions of contract employers are impacted by a company-specific administrative cost, which is used to cover the costs of Ilmarinen’s operations resulting from managing insurance and pensions. Thanks to Ilmarinen’s excellent efficiency, our administrative cost for contract employers is a maximum of around 0.18 % of the payroll in 2025. Earlier, the share of administrative cost was included in the basic TyEL contribution percentage, which was the same size in all pension companies. The surplus resulting from efficiency was refunded annually as a discount for large payrolls and as part of client bonuses.

The change entering into force on 1 January 2023 will make administrative cost more transparent and up to date. Ilmarinen’s administrative cost is calculated monthly, it is at the correct level when it is paid and reacts quickly to any changes in your business. It will not be adjusted based on annual data. For this reason, the 2023 TyEL contribution will no longer include the discount for large payrolls.

Ilmarinen’s administrative cost is the same size regardless of how long you have been a customer. Your insurance’s administrative cost amount is impacted by two factors: the payroll and the number of employees. The monthly calculation takes into account the payroll for the relevant month and the number of employees. They both take into consideration whether you are part of a group. Consolidating your group’s insurances with Ilmarinen reduces your administrative cost. The monthly review can lead to small differences in the amount of administrative cost, if the insured payroll and number of employees vary.

By logging in to the online service, you can see your amount of administrative cost and an estimate of your full TyEL contribution.

Log in to online service

Your company’s size affects your TyEL contribution

As a contract employer, your company’s size affects the amount of your TyEL contribution. If you are a temporary employer, your company size has no impact on the contribution because, as a temporary employer, you only pay the basic TyEL contribution.

Whether you are considered to be a small or large contract employer depends on the payroll, which is reviewed annually. In 2025, you are a small contract employer if your payroll in 2023 was less than EUR 2,337.000, and a large one if your payroll exceeded that sum.

As a small contract employer you always only pay the TyEL basic contribution. Your contribution is reduced by the client bonus that you receive once a year, just like other contract employers.

If you are a large contract employer, the amount of your TyEL contribution is mostly affected by the work ability of your employees. Based on their work ability, you are classified into a specific contribution category. As a large employer you receive other discounts in addition to the client bonus.

Are you a large employer? Take a look at large employers' TyEL contribution

Number of instalments and payment dates

You pay your TyEL insurance contribution once a month. The contribution is based on the earnings payment reports that you submit to the Incomes Register after each payment of wages and salaries. One payment covers all of your previous month’s earnings payment reports.

You receive the client bonus once a year. It reduces the next month’s TyEL contribution.

As a rule, your TyEL contribution falls due on the last day of the month following the payment of the wages or salaries. This last day of the month following the payment of the wages or salaries is called the theoretical due date of the TyEL contribution.

If you need to move the due date, do so in our online service. You can move the due date backby a maximum of one month. You pay the normal insurance contribution interest for the period.

In our online service, you can change the TyEL contribution to fall due in the second month following the payment of the salaries or wages. In this case, insurance contribution interest is added to the insurance contribution from the theoretical due date until the payment date.

Take a closer look at the payment and invoicing of TyEL contributions
Read more about changing the due date

  1. TyEL key figures

    TyEL contribution percentages and TyEL key figures.

    Read more