The definition of a partial owner will change on 1 July 2019

6/24/2019

As of 1 July 2019, the definition of a partial owner will change. In practice, the change will apply to entrepreneurs' non-owner family members who work in the family business. A family member who does not have personal ownership, voting power, or other control in the family business and who is insured under the Employees Pensions Act (TyEL) will be considered a wage earner. The unemployment insurance contribution is determined based on the wage earner's unemployment insurance contribution.

Partial owner of a company or corporation as of 1 July 2019:

If an income earner works in a company or corporation, but is not acting in a leadership position, he/she is a partial owner if either of the following conditions is fulfilled:

  • the income earner has at least 50 % of the share capital, voting power, or other control of the company or corporation in question
  • the income earner and his/her family members have between them at least 50 % of the share capital, voting power, or other control of the company or corporation in question.

If an income earner is acting in a leadership position in a company or corporation, but is not an entrepreneur, he/she can be a partial owner if either of the following conditions is fulfilled:

  • the income earner has at least 15 % of the share capital, voting power, or other control
  • the income earner and his/her family members have between them at least 30 % of the share capital, voting power, or other control.

The obligation to pay unemployment insurance contributions is reviewed based on the wage payment date. The deciding factor is whether the family member is a partial owner on the date when the wage is paid.

Partial owners of a company pay lower employee's unemployment insurance contributions than employees. The concept of a 'partial owner' is defined in the unemployment security act (työttömyysturvalaki 1290/2002). The partial owner data is reported to the Incomes Register by entering the Type of additional income earner data: Partial owner.

More information on partial ownership available at the Employment Fund's website