Social security for the self-employed

Take out or transfer YEL insurance

As an entrepreneur, you take care of your pension cover by taking out pension insurance for the self-employed, i.e. YEL insurance.​ Your social security is based on the income that you have reported for your YEL insurance. You will receive financial support if you fall ill or become unemployed, if your family expands or if you retire. Make sure right from the start that your basic cover is sufficient. That is easy to do by paying the required social insurance contributions.

For the self-employed, earnings-related pension insurance and health insurance are mandatory. You can supplement your insurance cover through various voluntary insurances, such as accident insurance and medical expenses insurance.

If you employ personnel, read about employers’ social insurance contributions.

Social insurance contributions of the self-employed and income limits 

Self-employed persons can insure themselves voluntarily according to the Employment Accidents Insurance Act, and they can join the Unemployment Fund for Entrepreneurs and the Self-Employed.

Self-employed person’s YEL contribution rates

Self-employed person’s YEL contribution rates

2020 2019

18–52-year-olds and 63–68-year-olds

24.1 % 24.1 %

53–62-year-olds*

25.6 % 25.6 %
NEWLY SELF-EMPLOYED (22 % DISCOUNT)    

18–52-year-olds and 63–68-year-olds

18.798 % 18.798 %

53–62-year-olds*

19.968 % 19.968 %

*The YEL contribution changes at the start of the year after the year the entrepreneur turns 53 or 63.

Farmer’s MYEL contribution rates

Farmer’s MYEL contribution rates

2020 2019

For confirmed income under €27,882.12

  • under 53 years of age
  • Start of the year after the year the person turns 53

 

13.0140 %
13.8240* %

 

13.0140 %
13.8240* %

For confirmed income over €43,814.83

  • under 53 years of age
  • Start of the year after the year the person turns 53

 

24.1 %
25.6* %

 

24.1 %
25.6* %

For confirmed income between €27,882,12–€43,814.83

contribution rate rises gradually

contribution rate rises gradually

*As of 2017, 53–62-year-olds are subject to the increased contribution.

YEL and TyEL limits

Insurance 2020 2019
Lower limit Upper limit Lower limit Upper limit
YEL € 7,958.99 € 180,750.00 € 7,799.37 € 177,125.00
TyEL € 60.57 - € 59.36 -

YEL insurance has a lower and upper limit, TyEL insurance has a lower limit. The YEL limits concern YEL confirmed income and the TyEL limit concerns the payroll. Take out insurance when the lower limit is exceeded.

Take out YEL insurance    Take out TyEL insurance

The insured’s health insurance contribution

Who pays 2020, contribution, % 2019, contribution, %  
Entrepreneur 1.33 % 1.77 % The contribution is distributed as follows:
1.18 % daily allowance contribution *
0.15 % entrepreneur's additional funding contribution
0 % medical care contribution
Employee 1.86 % 1.54 %

The contribution is distributed as follows:
1.18 % daily allowance contribution *
0.68 % medical care contribution

Pensioner 1.65 % 1.61 %  

The contribution is included in the withholding tax rate and concerns the self-employed and employees.

* If the total amount of wages and income is less than 14 574 euro, the daily allowance contribution is 0.00 percent. 

Workers’ compensation, unemployment and group life insurance

Insurance Who pays 2020, contribution, % 2019 contribution, %

Workers’ compensation insurance, average

Wages and the risks of the work determine the contribution rate.
Take out insurance from a non-life insurance company.

Employer 0.70 % 0.70 %

Unemployment insurance, average

The payroll affects the contribution rate.
Take out insurance from the Employment Fund for employees aged 17–64.

Employers with a max. payroll of €2,125,500 0.45 % 0.50 %
Employers with a payroll of more than €2,125,500 1.70 % 2.05 %
Employee 1.25 % 1.50 %
Employer for a part-owner 0.45 % 0.50 %
Part-owner 0.65 % 0.78 %

Group life insurance, average

You take out group life insurance automatically when you take out workers’ compensation insurance. The non-life insurance company collects the contribution in connection with this insurance and pays it into the Employees’ Group Life Assurance Pool. Claims are handled by the Finnish Workers' Compensation Center, www.trhv.fi or www.tvk.fi.

Employer 0.07 %

0.07 %

 

Index figures and life expectancy coefficient

  2020 2019
Wage coefficient 1.446 1.417
Earnings-related pension index 2617 2585
Life expectancy coefficient 0.95404
(b. 1958)

0.95722
(b. 1957)

The wage coefficient affects the amount of earnings and the YEL confirmed income. The earnings-related pension index affects the number of pensions. The life expectancy coefficient decreases the amount of pension as life expectancy increases.

Interest

Interest Period 2020 2019 
 Insurance contribution interest rate, TyEL*  1 Jan. – 30 Jun.  2.0 %  2.0 %
 1 Jul. – 31 Dec.    2.0 %
 Insurance contribution interest rate, YEL*  1 Jan. – 31 Dec.  2.0 %  2.0 %
 Late payment interest  1 Jan. – 30 Jun.  8.0 %  8.0 %
 1 Jul. – 31 Dec.    8.0 %

*The insurance contribution interest rate is set twice a year based on the dates of 15 Nov. and 15 May, entering into effect on 1 Jan. and 1 Jul. When calculating the YEL insurance contributions, the insurance contribution interest rate remains the same throughout the year.

Daily sickness allowance for the self-employed

Self-employed persons who live in Finland and are aged between 18–67 are entitled to daily sickness allowance. The right to daily sickness allowance stems from work disability due to an illness. The YEL confirmed income determines the amount of a self-employed person’s daily sickness allowance. The allowance is applied for from Kela. 

Read more about the impact of confirmed income

Kela’s sickness allowance calculator (in Finnish)

 

Self-employed person’s accident insurance

As a YEL-insured self-employed person, you can take out voluntary accident insurance. The insurance requires that you have a valid YEL insurance policy. The insurance contribution for voluntary accident insurance, compensation for loss of income and the pension are based on the YEL confirmed income. Read more at tvk.fi.

 

Unemployment benefits for the self-employed

Self-employed persons are eligible to receive unemployment benefits when their full-time employment is considered to have ended. As a member of the Unemployment Fund (SYT), a self-employed person can receive daily unemployment allowance that is based on his/her YEL confirmed income. A self-employed person who is not a member of the Unemployment Fund can receive basic unemployment allowance or a labour market subsidy, which are paid by Kela. You can apply for unemployment benefits from Kela.

Self-employed persons can receive basic unemployment allowance if they meet the work requirement and their earnings are at the minimum required level. A self-employed person who is not entitled to receive basic unemployment allowance can apply for the means-tested labour market subsidy.

Self-employed persons are entitled to earnings-related daily unemployment allowance if they belong to the Unemployment Fund and they meet the work requirement. YEL confirmed income affects the unemployment benefits of the self-employed. It is the basis for determining the amount of earnings-related daily allowance granted by unemployment funds.

Read more about the impact of confirmed income

Changes, which took effect on 1 July 2019, were made to the unemployment benefits of a family member working in a family company.

The Unemployment Fund for Entrepreneurs and the Self-Employed (AYT Unemployment Fund) and the Unemployment Fund for Entrepreneurs (SYT Unemployment Fund) will merge on 1 January 2020, when AYT is absorbed by SYT. If you wish to improve your unemployment benefits, turn to the Finnish Unemployment Fund for Entrepreneurs SYT (in Finnish). 

Parental allowance for the self-employed

The amount of maternity, paternity and parental allowance applied for from Kela is determined based on the YEL confirmed income. Daily allowance benefits have been based on annual earnings as of 1 January 2010. The amount of the benefits is affected by the earnings from the 12 months preceding the calendar month when the entitlement to benefits begins. More information on the change in how daily allowance is determined is available on Kela’s website.

Read more about the impact of confirmed income

YEL certificate for Kela

 

Secure your future, take out YEL insurance