Households as employers

When is a household an employer and subject to the TyEL employees’ pensions act?

When you hire, for example, a builder, renovator, cleaner, painter, child care provider or au pair to work in your home or summer cottage and you pay wages directly to that person, you become an employer.

When you hire an employee, you also accept the obligations of an employer. In addition to paying wages, you as an employer must take care of statutory insurance related to the employment relationship. This includes earnings-related pension insurance (TyEL) and group life insurance based on workers’ compensation insurance and collective agreements. In addition, you are usually also required to pay the unemployment insurance contribution.

Take care of the pension cover of your employee by paying the earnings-related pension contribution, i.e. TyEL contribution. Whether you need to pay it or not depends on whether you are a temporary employer or a contract employer.

When is it not necessary to pay the TyEL contribution?

It is not necessary to pay the TyEL contribution

  • if you order work from an entrepreneur or a company. They take care of the contributions for you (remember to find out if the person you hire is an entrepreneur, i.e. if he or she has valid YEL insurance),
  • if the monthly salary is less than EUR 59.36 (in 2019, the limit varies annually),
  • if the employee you hire is aged under 17, or 68 or over.

TyEL contributions for Finnish and foreign employees are paid in the same way.

Tax credit for domestic expenses

You can deduct part of the expenses of work carried out in your home or summer cottage from your taxes as a tax credit for domestic expenses.