The Self-Employed Persons’ Pensions Act (YEL) was renewed – we are reviewing YEL income together with the self-employed

YEL income reviews will start in stages under the amended act between 2023 and 2025.

In 2024, a YEL income recommendation will be given to entrepreneurs whose

• YEL income is less than EUR 25,000 per year.
• YEL income has not changed significantly (15%) over the past three years.
• Insurance has been valid for at least three years.
• YEL income would change by more than 5% due to a review.

In 2024, a YEL income recommendation will not be given to entrepreneurs whose

• YEL income is less than EUR 25,000 per year, but whose YEL insurance has not yet been valid for three years as of this year. In this case, the review will take place later. We will review your YEL income during the year in which three years have passed since your YEL income was last confirmed.
• YEL income has changed substantially, i.e. by at least 15% in the last three years
• YEL income would change by at most 5% due to a review.
• YEL income is more than EUR 25,000 per year.

See the YEL income review schedule in the table below.

Not everyone’s YEL income will increase. For those whose YEL income will increase, the increase will not happen all of a sudden and by a large amount all at once. YEL income will increase for self-employed persons whose YEL income is far from the value of their work input.

We will calculate a personal YEL income recommendation for you. We use the YEL income calculator that is used throughout the pension insurance sector. It takes into account the median salary of full-time private sector employees in your business sector, your turnover for the past three years and any earnings you have received from other work that indicate the part-time nature of your business. The calculator uses median salary data obtained from Statistics Finland, turnover and sector data from the tax authority and earnings data from the Incomes Register.

Maximum increase

In the first two review periods, the pension company can increase a person’s YEL income by a maximum of EUR 4,000 per review. This means a maximum increase of EUR 85 in the monthly YEL insurance contribution per review period. YEL contributions are tax-deductible.

The maximum increase may concern a self-employed person whose

• YEL insurance was valid when the reformed act took effect on 1 January 2023.

The maximum increase will not concern a self-employed person whose

• YEL insurance became valid after the reformed act took effect. 
• YEL insurance was taken out retroactively after the reformed act took effect such that the date when the insurance became valid is before 2023.

Not everyone’s YEL income will increase by the maximum amount

A self-employed person’s YEL income might not necessarily increase by EUR 4,000. YEL income may in some cases be revised to the recommended level even with a smaller income adjustment. The increase in the monthly YEL contribution could then be somewhere between EUR 10–80. At the entrepreneur’s request, their YEL income and therefore contribution can be increased even more in the reviews, which means their pension and social security will also increase more rapidly.

This is how much the YEL contribution can increase

If an entrepreneur’s minimum YEL income is EUR 9,010 (in year 2024) and YEL contribution is EUR 181 per month, their YEL contribution can increase at most by EUR 85 in the first increase. This means that their YEL contribution of EUR 181 per month will increase to EUR 266 per month.

In the second round of reviews, three years later, this EUR 266 per month YEL contribution can be increased again by a maximum of EUR 85. This means the new monthly YEL contribution is approximately EUR 350.

Here you can read examples of different situations:

1. An entrepreneur has not raised or lowered YEL income by more than 15 per cent
2. Entrepreneur’s insurance began at the start of 2023

1. I have not changed my YEL income over the past three years

Matt’s YEL insurance started in 2019, and he has not changed his YEL income since then. Matt’s YEL income is EUR 15,600 in 2024. He now works full time, and his turnover is the average for companies in his business sector. Matt will receive a YEL income recommendation from us in 2024.

As a pension company, we can independently confirm Matt’s YEL income at no more than EUR 19,600 (15,600 + 4,000) unless Matt himself wants to raise it by more and, at the same time, improve his pension and other social security at a faster pace.

The next time we give Matt a new YEL income recommendation will be in 2027 unless Matt changes his YEL income himself before then. After the act’s entry into force, the maximum amount a pension company can increase an entrepreneur’s YEL income for a second time is EUR 4,000, even if the recommended YEL income from full-time work in their business sector would require a bigger increase than this.

See more examples (in Finnish) here (tyoelakelakipalvelu.fi)

2. My insurance began at the start of 2023

In February, Laura applies for YEL insurance for her part-time entrepreneurial activities effective as of 1 January 2023. We confirm Laura’s YEL income according to the recommended amount and will review it in three years, i.e. in 2026.

A significant change takes place in Laura’s work input, with her work changing from part time to full time. However, she does not realise that she should increase her YEL income to the recommended level. Laura’s YEL income can also be raised by more than EUR 4,000 at one time in the pension company’s YEL income review if required under the recommendation, because Laura’s insurance was not yet valid when the act entered into force on 1 January 2023, which means the maximum limit does not apply.

If an entrepreneur’s YEL income is already at the recommended level or if the change would be at most 5%, we will not propose a change to the person’s YEL income in the review.

The YEL income recommendation is based on the median salary level of full-time private sector employees in your business sector. To calculate our recommendation, we use a YEL income calculator that is used throughout the pension insurance sector. It takes into account

• the median salary of full-time private sector employees in your business sector
• the median turnover of self-employed persons in your business sector 
• your turnover for the past three years (coming)
• any earnings you have received from other work that indicate the part-time nature of your business. (coming)

The calculator uses median salary data obtained from Statistics Finland, turnover and sector data from the tax authority and earnings data from the Incomes Register.

When determining the YEL income, we also take into account other information you provide describing the amount of your work input, the scope of your self-employed activities, your skills and knowledge, and the value of your work input.

We will send your YEL income decision primarily to the online Suomi.fi Messages service if you use this service. Secondarily, we will send your decision to the online OmaPosti service if you use this service. Otherwise, you will receive the decision by post to the address in your YEL insurance policy.

Activate Suomi.fi Messages (suomi.fi)

The YEL income recommendation is, as the name suggests, a recommendation that can be deviated from above or below the proposed level for justified reasons. When confirming your YEL income, we use overall judgement, taking into account the additional information you provide, the requirements of the YEL act and the current guidelines.

If you reject our YEL income recommendation, we will ask you additional questions and, if necessary, request further information from you. Be sure to answer the questions carefully. Finally, we will either confirm a new level of YEL income for you or inform you that no change will be made to your current YEL income.

In most cases, we reach an agreement with entrepreneurs on the level of their YEL income. If the additional information you provide is insufficient to justify your proposed YEL income, and you are not satisfied with our YEL income decision, you can lodge an appeal against a decision you believe was made on the wrong grounds. Instructions on how to lodge an appeal are attached to the YEL income decision.