Social insurance contributions
The employer's social insurance contributions include the following:
- health insurance contribution
- earnings-related pension insurance contribution
- unemployment insurance contribution
- occupational accident and disease insurance contribution
- group life insurance contribution.
Employers must pay health insurance contributions for 16 to 67 year old employees who are covered by the Finnish social insurance system in accordance with the Health Insurance Act.
The employer’s health insurance contribution must be paid even if no tax can be withheld. This may be the case, for example, when wages are paid as fringe benefits rather than money, or when the employee’s tax card indicates that no tax is to be withheld. No health insurance contributions are paid on trade income.
In addition, the employee has to pay the insured party’s health insurance contribution. It is included in the withholding rate, so you do not need to withhold it from the employee’s wages separately.
If the employee receives wages for working abroad , the pay may be exempt from tax in Finland based on the six-month rule. The employee’s health insurance contribution (“minimum withholding”) and the employer's health insurance contribution must be collected on the wages for insurance purposes.
|Pay to the Tax Administration||2019||2018|
|Employers’ health insurance contribution||0,77 %||0,86 %|
|The health insurance premium of the insured party:|
0,00 % for income of less than €14,282
0,00 % for income of less than €14,020
|The minimum withholding (health care contribution and daily care contribution)||1,54 %||1,53 %|
|Medical care contribution on pension and social-benefit income||1,61 %||1,53 %|
|Increase of the daily allowance contribution for self-employed individuals with YEL insurance||0,23 %||0,17 %|
|Self-employed individual’s increased daily allowance contribution||1,77 %||1,70 %|
Employees must provide earnings-related pension insurance for 17 to 68 year old employees whose monthly pay exceeds the minimum threshold for the obligation to provide insurance. Both the employer and the employee pay health insurance contributions. If you are an employer, you must withhold the employee’s contribution when you pay wages. Pay both the employee's and the employer's social insurance contributions to the pension insurance company.
|Pay to your insurance company||2019||2018|
|Employee's pension insurance contribution (worker’s ages 17 to 52)||6,75 %||6,35 %|
|Employee's pension insurance contribution (worker’s ages 53 to 62)||8,25 %||7,85 %|
|Employee's pension insurance contribution (worker’s ages 63 to 67)||6,75 %||6,35 %|
|Employer’s pension insurance contribution (average rate)||17,3 %|
|Employer’s pension insurance contribution (seafarers)||12,8 %||13,2 %|
The employer must pay an unemployment insurance contribution if the total amount of wages paid to employees during the calendar year exceeds €1,300. The unemployment insurance contribution is paid for employees aged 17 to 64.
Employees must also pay unemployment insurance contributions. If you are an employer, you must calculate the contribution based on the total wages and fringe benefits and deduct the employee’s contribution from their net wages.
The obligation to provide insurance also applies to the company’s co-owners.
Pay to the Employment Fund (Työllisyysrahasto/Sysselsättningsfonden)
Employer’s unemployment insurance contribution
0,50 %, if paid wages no more than €2,086,500 a year
2,05 %, if paid wages go over €2,086,500 a year
0,50 % for partial owners of a company
0,65 %, if paid wages no more than €2,083,500 a year
2,60 %, if paid wages go over €2,083,500 a year
0,65 % for partial owners of a company
|Employee's unemployment insurance contribution||1,50 %||1,90 %|
|The unemployment insurance contribution of a shareholder-employee||0,78 %||0,92 %|
Employers must provide their employees with insurance coverage against occupational accidents and diseases if the total amount of wages paid during a calendar year exceeds €1,300. The insurance must be effective as the employment begins.
The accident insurance contribution varies by line of business and by company. The insurance company will send you an invoice on the contribution.
If you are an entrepreneur, you can take out an accident insurance for entrepreneurs.
You may also have to take out a group insurance policy for your employees, if it is so agreed in the collective labour agreement that applies to you.
The insurance company will collect the group insurance contribution together with the accident insurance contribution. The insurance company will send you a separate invoice. The contribution varies by line of business and by company.