Reporting data to the Incomes Register: payments made by substitute payer

Date of issue
12/9/2022
Record no.
VH/6181/00.01.00/2022
Validity
1/1/2023 - 12/31/2023

These instructions are for parties acting as substitute payers and for actual employers.

They describe:

  • the obligation of substitute payers and actual employers to report data to the Incomes Register
  • reports submitted by a substitute payer to the Incomes Register
  • reports submitted by an actual employer to the Incomes Register in situations involving a substitute payer.

In addition, examples are provided to describe the reporting of the most common situations involving a substitute payer: reporting of payments made by Kela, a bankruptcy estate, wellbeing services countiesand and pay security.

The examples in these instructions do not depict all mandatory data, only the data required in situations involving a substitute payer. The sums used in the examples are examples only and the amount of social insurance contributions and the withholding rate must be checked for each year. The withholding is determined on the basis of the withholding rate of each recipient.

More information on households' obligation to report income is provided in the instruction Reporting data to the Incomes Register: households as employers.

These instructions replace the earlier instructions titled Reporting data to the Incomes Register: payments made by substitute payer.

The following additions and clarifications have been made to the instructions:

  • Changes made to the transfer of the provision of personal assistance from municipalities to wellbeing services counties in sections 1 and 2.2.
  • Information about basic substitute payer situations used in reporting presented in a table in section 2.1.
  • Clarified the payer’s customer identifier used in reporting in section 2.3.
  • Supplemented the pay security text in section 2.4.
  • Clarified the payment of employee contributions in conjunction with distributable shares and supplemented the reporting of unemployment insurance information when a full distributable share is not accrued for wages paid as distributable shares in section 2.4.4.

1 General information on situations involving a substitute payer

Substitute payer means a payer who pays wages or other remuneration from their own funds on behalf of a party with the actual liability to pay (actual employer). Further, the substitute payer reports data to authorities on behalf of the actual employer based on either law or agreement (e.g. reports to the Incomes Register). As a rule, the substitute payer pays the wages and withholds tax while the actual employer pays the employer’s social insurance contributions. 

Usual substitute payers include enforcement agencies, wellbeing services counties, Kela, Centres for Economic Development, Transport and the Environment (ELY Centres) and bankruptcy estates. Other potential substitute payers include creditors, guarantors or other payers acting on behalf of an employer who is in financial difficulties and in some exceptional cases also housing companies. Group companies and foreign employers can also use substitute payers.

A substitute payer is not the same as an agent. Agents act in, and under, the name of the actual payer (e.g. the employer). Their actions are usually based on an authorisation. They can also use the funds of the principal to make payments. The agent and the actual employer can also agree that the agent should handle all the employer obligations on behalf of the actual employer. Detailed information about being an agent is not provided in these instructions.

From 1 January 2023, the role of wellbeing services counties as a substitute payer is significant when the municipality is in charge of paying wages to a personal assistant and reporting data on behalf of a person requiring assistance.

The substitute payer can report the data on all the employees of one actual employer in one record. Payments made as a substitute payer and payments made by the same party to its own employees cannot be reported in one and the same record. More information on reporting is provided in other detailed instructions concerning the Incomes Register.

1.1  Substitute payer’s obligations

The substitute payer pays an employee or other income earner on behalf of the actual employer from their own funds. Under the prepayment act (ennakkoperintälaki 1118/1996), the substitute payer is obligated to withhold tax even if the work paid for was carried out in the name of the actual employer. If, instead of the payer, the payer's guarantor, creditor or other payer (substitute payer) pays wages to the income earner, the party who makes the payment has the obligation to withhold tax on the paid amount if no tax has been withheld previously. Correspondingly, the enforcement authority is liable to withhold tax on the funds accrued through enforcement, and a bankruptcy estate on payments made from the estate's assets.

The substitute payer must submit a report to the Incomes Register on all the wages paid and taxes withheld. The substitute payer must also report to the Incomes Register the earnings-related pension insurance contributions and unemployment insurance contributions collected from an employee, if the substitute payer has collected and deducted the employee's social insurance contributions from the wages paid to the employee. Income tax is levied in the income earner's tax assessment on the basis of the substitute payer's report. Correspondingly, the guarantor, creditor or other payer is obligated to report to the Incomes Register any payments they have made as a substitute payer. Social insurance contributions can be imposed on the actual employer on the basis of the substitute payer’s reports.

The substitute payer’s obligations may vary according to what has been agreed between the substitute payer and the actual employer. As a rule, the substitute payer is not obligated to pay the employer’s social insurance contributions – paying them is the responsibility of the actual employer.

1.2  Employer obligations

Although the substitute payer pays wages on behalf of the employer, the actual employer is obligated to report the wages paid by the substitute payer on an earnings payment report using a separate form for each income earner. Specific income types for situations involving a substitute payer are used to report this data.

If the substitute payer has paid income that does not constitute grounds for social insurance contributions, the actual employer need not submit reports.

The actual employer is obligated to pay the employer’s social insurance contributions on the basis of the wages paid by the substitute payer. This means that the actual employer must see to it that they arrange statutory earnings-related pension insurance with an authorised pension provider (i.e. take out insurance with an authorised pension company or provide insurance through an industry-wide pension fund or a company pension fund) and, as a result, have a pension policy number required for pension insurance purposes.

The employer has the obligation to take out occupational accident and occupational disease insurance by signing an insurance contract with an accident insurance provider. Insurance must be taken out before the commencement of work. As a policy holder, the employer is obligated to pay the insurance contributions. On the Incomes Register's earnings payment report the employer must report the occupational accident insurance company identifier and the policy number, if the employer has concurrent occupational accident insurances.

The employer is also obligated to pay the unemployment insurance contributions and submit earnings payment reports to the Incomes Register. Similarly, the employer is obligated to pay and report the employer's health insurance contributions to the Incomes Register using the employer's separate report.

The reporting obligations of households are described in more detail in instructions Reporting data to the Incomes Register: households as employers.

1.3  Deadline for reporting

As a rule, substitute payers must submit reports on monetary payments no later than on the fifth calendar day after the date of payment. The date of payment refers to the date on which the payment is available to the income earner, for example withdrawable on the income earner's account.

Actual employers must submit an earnings payment report and the employer's separate report to the Incomes Register for each wage payment month no later than on the fifth day of the calendar month following the payment month (section 12(9) of the act on the Income Information System; laki tulotietojärjestelmästä 53/2018). If the actual employer itself has also made payments to the income earner, they must be reported in addition to the payments made by the substitute payer. However, it must then be taken into account that, as a rule, the deadline for reporting payments made by the actual employer is the fifth calendar day after the date of payment.

Reporting deadlines and penalties for failing to meet deadlines are described in more detail in the instructions Reporting income data: penalty fees and Reporting data to the Incomes Register.

1.4  Terminology

Terminology
Term Description
Substitute payer A payer who pays wages or another payment using their own funds on behalf of the party that has the actual payment obligation (actual employer).
Actual employer A party who has a legal obligation to pay wages and take out insurance for employees. The actual employer is the party who has hired the employee and in whose name the employee works.
Agent A party acting on behalf and in the name of the actual employer. The acting as an agent is usually based on an authorisation. Furthermore, an agent uses their client’s funds when making payments.
Contractual employer A term used in the earnings-related pension sector to refer to an employer which has valid TyEL insurance (pension policy number NN-XXXXXXXX), meaning an insurance agreement with an earnings-related pension provider. The employer must enter into an insurance agreement if it has at least one regular employee or if it pays at least EUR 9,348 in total wages to its fixed-term employees over six months (in 2023).
Temporary employer A term used in the earnings-related pension sector to refer to an employer which does not have valid TyEL insurance with an earnings-related pension provider. The employer does not need to enter into an insurance agreement, meaning that it can act as a temporary employer, if it has no regular employees and if it pays less than EUR 9,348 in total wages to its fixed-term employees over six months (in 2023).
Personal assistant Personal assistant means an employee who has been hired as an assistant for a person with severe disability, for example.
Person requiring assistance (PRA) PRA refers to a person who requires assistance, i.e. the actual employer. The person being assisted can be a minor or an incompetent person.
Substitute payer’s report The substitute payer's report means an earnings payment report that the substitute payer is obligated to submit to the Incomes Register on each income earner on the basis of the payments made.
Actual employer's report The actual employer's report means the earnings payment report submitted by the actual employer to the Incomes Register on the wages paid by a substitute payer. Additionally, the actual employer must report any other payments it has made to the income earner. The actual employer’s report also means the employer's separate report on the total amount of health insurance contributions submitted by the actual employer.

2 Reporting of substitute payers payments to the incomes register in different situations

2.1 Basic situation

As a rule, a substitute payer reports monetary payments and other benefits to the Incomes Register no later than on the fifth calendar day after the date of payment using an earnings payment report. All the income types used in the Incomes Register are at the substitute payer's disposal. Monetary wages, for example, are reported by the substitute payer using either a method with lower level of detail (reporting method 1) or a method with greater level of detail (reporting method 2). The reporting of wages is described in more detail in the instructions Reporting data to the Incomes Register: monetary wages and items deducted from wages. The substitute payer reports their substitute payer status and the actual employer's customer identifier in the “Substitute payer” data group.

The income and the tax withheld are taken into account in the income earner’s tax assessment on the basis of the report submitted by the substitute payer. In contrast, the employer’s social insurance contributions are determined on the basis of the actual employer's earnings payment report and the employer's separate report.

Actual employers must submit an earnings payment report to the Incomes Register for wages paid by a substitute payer. In addition, an employer’s separate report must usually also be submitted. If the actual employer makes payments to the income earner, those must be reported as well. The actual employer’s reports can also be submitted by another party, such as a substitute payer, if this has been agreed separately by the substitute payer and the actual employer. Even in such a case, the responsibility for reporting falls on the actual employer.

If the substitute payer has paid only income that does not  constitute grounds for social insurance contributions, the actual employer need not submit an earnings payment report to the Incomes Register.

The actual employer must submit an earnings payment report to the Incomes Register using income types specified for situations involving a substitute payer (see the list below). If the wages paid to the income earner are subject to all social insurance contributions, the actual employer reports the wages under the income type: ”Wages paid by substitute payer: employer pays for the employer's social insurance contribution (earnings-related pension, health, unemployment, and occupational accident and disease insurance contributions)”. If the wages are subject only to a certain employer's contribution, the income is reported under the income type for that particular contribution. For example, if the income were subject only to the employer's health insurance contribution, it would be reported under the income type “Wages paid by substitute payer, employer pays for employer's health insurance contribution”. More than one income type intended for situations involving a substitute payer can be used for the same payment (see Section 2.1, example 3, table 2 and Section 2.5, example 9, table 2).

The actual employer can use the following income types in its reports:

Actual employer's income types
Code* Income type name
321 Wages paid by substitute payer: the employer pays for the employer's social insurance contributions (earnings-related pension, health, unemployment, and accident and occupational disease insurance)
322 Wages paid by substitute payer: employer pays for employer's earnings-related pension insurance contribution
323 Wages paid by substitute payer: employer pays for employer's unemployment insurance contribution
324 Wages paid by substitute payer, employer pays for accident and occupational disease insurance contribution
325 Wages paid by substitute payer, employer pays for employer's health insurance contribution

* The code in front of the name of the income type is the code value used for the income type in the earnings payment report.

Any payments made are reported according to the employer's obligations regarding the income in question.

The actual employer must report all the data about the employer and the income earner that are needed by data users. This means that, for example, if the actual employer is a temporary employer, they must report the detailed contact information needed by the authorised pension provider. Correspondingly, the data needed by data users about the income earner must be reported; for example, if the income earner is a non-resident taxpayer. Furthermore, it is recommended that the actual employer should report the necessary employment relationship data about the income earner and any absence data available. Reporting earnings periods is recommended, as the information is needed by many data users.

If a substitute payer has paid wages two times in a month, either payment date can be entered in the actual employer's earnings payment report. The priority is that the report is allocated to the correct payment month. Alternatively, the actual employer can submit two separate earnings payment reports for each payments made by the substitute payer.

In addition to the payments made by a substitute payer, the actual employer must report any payments it has made to the income earner. However, it must then be taken into account that, as a rule, the deadline for reporting payments made by the actual employer is the fifth calendar day after the date of payment. If a payment is made by a natural person or an estate that is not registered in the Tax Administration’s Employer Register, the data on the payments made by the employer itself can be submitted by the same deadline as the data on the substitute payer's payments, i.e. by the fifth day of the calendar month following the month of payment.

The payment periods of the actual employer and of the substitute payer may be different.

The actual employer must also submit to the Incomes Register the employer's separate report, reporting the total amount of the employer’s health insurance contribution and a deductible amount calculated on the basis of any items deductible from the employer’s health insurance contribution. Households must submit the employer's separate report if the amount of wages paid to one employee is more than EUR 1,500 a year. More information on households' obligation to report income is provided in the instructions Reporting data to the Incomes Register: households as employers.

The need for submitting an employer's separate report depends on whether the actual employer pays wages regularly or casually and whether the payment was income subject to a health insurance contribution or other income.

  • Over the month, the substitute payer makes payments subject to a health insurance contribution and the actual employer is a regular employer:
    • The actual employer reports the total amount of the employer's health insurance contribution every month.
  • Over the month, the substitute payer makes payments subject to a health insurance contribution and the actual employer is a casual employer:
    • The actual employer reports the total amount of the employer's health insurance contribution for the months during which wages have been paid.
  • Over the month, the substitute payer only makes payments not subject to a health insurance contribution and the actual employer is a regular employer:
    • If the payment was, for example, non-wage compensation for work, a meeting fee paid to an outsider, or reimbursement of expenses, the actual employer reports EUR 0 as the amount of the employer's health insurance contribution.
  • Over the month, the substitute payer only makes payments not subject to a health insurance contribution and the actual employer is a casual employer:
    • If the payment was, for example, a meeting fee paid to an outsider or reimbursement of expenses, the actual employer reports EUR 0 as the amount of the employer's health insurance contribution.
    • If the payment was, for example, non-wage compensation for work, an employer's separate report does not need to be submitted.

The reporting of payments made as pay security and payments made by a bankruptcy estate is described separately in section 2.4.

A summary of reporting in a basic situation

A summary of reporting in a basic situation
1. Earnings payment report (substitute payer)
Payer’s Business ID Available income types Pension policy number and accident insurance policy number* Other notes

Business ID of the party who pays income on behalf of the actual employer

All income types of the Incomes Register (series 100–400) according to what has been paid and collected

Not provided

The report is submitted separately for each income earner.

The report must also include

  • ”Acts as substitute payer” data
  • Business ID is the party on whose behalf the substitute payer makes the payment (customer identifier of the actual employer).
2. Earnings payment report (actual employer)
Payer’s Business ID Available income types Pension policy number and accident insurance policy number* Other notes

Business ID of the actual employer

321 Wages paid by substitute payer: the employer pays for the employer’s social insurance contributions (earnings-related pension, health, unemployment, and accident and occupational disease insurance)

or alternatively income types 322–325 according to the social insurance contributions, subject to which the income paid by the substitute payer was

The pension policy number and the accident insurance policy number of the actual employer

The report is submitted separately for each income earner.

If the income paid by the substitute payer is not subject to social insurance contributions, the actual employer’s earnings payment report is not submitted.

The following are also recommended to be entered on the report:

  • employment relationship data
  • absence data
  • income earnings periods.
2. The employer’s separate report (actual employer)
Payer’s Business ID Available income types Pension policy number and accident insurance policy number* Other notes

Business ID of the actual employer

101 No wages payable

102 Employer’s health insurance contribution (total)

103 Deductions to be made from the employer’s health insurance contribution

The actual employer’s pension policy number is entered if ‘No wages payable’ (101) is selected

Submitting the employer’s separate report is affected by

  • whether the actual employer pays wages regularly or irregularly
  • whether the payment made was income subject to the health insurance contribution or other income.

See more detailed instructions in section 2.1.

* The occupational accident insurance policy number must be submitted on the report only if the employees are insured with more than one accident and occupational disease insurance policy.

Example 1: Basic case, the actual employer is a contractual employer.

On 15 August, a substitute payer has paid an income earner on behalf of the actual employer EUR 1,500 in time-rate pay and EUR 500 in evening shift allowance, withheld EUR 400 in taxes and collected the employee’s social insurance contributions.

The substitute payer reports to the Incomes Register the following details:

Example 1, table 1/3

Earnings payment report submitted by substitute payer

Type of action: New report

Pay period

Payment date: 15.08.20xx

The start date of the pay period:01.08.20xx

The end date of the pay period:31.08.20xx

Payer (=substitute payer's) details

Type of identifier: Business ID

Identifier: 1234567-8 (substitute payer’s customer ID)

Substitute payer data group

Acts as substitute payer: Yes

Employer's identifier type:Business ID

Employer identifier: 8765432-1 (actual employer's customer ID)

Income earner data

Type of identifier: Personal identity code (income earner's customer ID)

Identifier: ddmmyy-1234

Code Income type details EUR
201 Time-rate pay 1500.00
207 Evening shift allowance 500.00
402 Withholding tax 400.00
413 Employee's earnings-related pension insurance contribution 143.00
414 Employee's unemployment insurance contribution 30.00

The substitute payer does not collect and deduct the employee’s social insurance contributions from wages in all situations. To determine and verify the employer's social insurance contributions, the actual employer must report on its own report the wages paid by the substitute payer on which the employer pays the social insurance contributions.

The actual employer reports to the Incomes Register the wages paid to the income earner by the substitute payer:

Example 1, table 2/3

Actual employer’s report (earnings payment report)

Type of action: New report

Pay period

Payment date: 15.08.20xx

The start date of the pay period:01.08.20xx

The end date of the pay period: 31.08.20xx

Payer (=actual employer's) details

Type of identifier: Business ID

Identifier: 8765432-1 (actual employer’s customer ID)

Income earner data

Type of identifier: Personal identity code (income earner's customer ID)

Identifier: ddmmyy-1234

Occupational class: Statistics Finland's classification of occupations

Occupational class ID: NNNNN

Earnings-related pension insurance information: Employee's earnings-related pension insurance

Pension provider code: NN

Pension policy number of earnings-related pension provider: NN-XXXXXXXX

Code Income type details EUR

321

Wages paid by substitute payer: employer pays for employer's social insurance contribution

Earnings period 01.08.–15.08.20xx

2000.00

Additionally, the employer must report on the employer's separate report the total amount of health insurance contributions it has paid on the basis of the wages paid by the substitute payer.

The employer reports:

Example 1, table 3/3

Actual employer’s report (employer’s separate report)

Type of action: New report
Reporting date: 05.09.20nn

Payer (=actual employer's) details

Type of identifier: Business ID

Identifier: 8765432-1 (actual employer’s customer ID)

Report information

Payment month: 08

Payment year: 20nn

Code Income type details EUR
102 Employer's health insurance contribution (total) 26.80

Example 2: Basic case, the actual employer is a temporary employer.

The substitute payer pays EUR 1,650 to the income earner. The amount contains EUR 1,000 in contract pay, EUR 500 in compensation for termination and EUR 150 in compensation for waiting time.

The substitute payer withholds taxes (EUR 375) from the income earner's pay. In addition, the substitute payer collects the employee’s social insurance contributions from the pay subject to earnings-related pension and unemployment insurance contributions (EUR 1,000). The compensations for waiting time and termination are not subject to social insurance contributions.

The substitute payer reports the data to the Incomes Register on an earnings payment report:

Example 2, table 1/4
Earnings payment report submitted by substitute payer (reporting method 2 for monetary wages)
Type of action: New report

Pay period

Payment date: 15.02.20xx

The start date of the pay period:01.02.20xx

The end date of the pay period: 10.02.20xx

Payer (=substitute payer's) details

Type of identifier: Business ID

Identifier: 77885544-8 (substitute payer’s customer ID)

Substitute payer data group

Acts as substitute payer: Yes

Employer's identifier type: Business ID or personal identity code

Employer identifier: 01010101-1 (actual employer's customer ID)

Income earner data

Type of identifier: Personal identity code (income earner's customer ID)

Identifier: ddmmyy-4321

Code Income type details EUR
227 Contract pay 1000.00
208 Notice period compensation 500.00
217 Waiting time compensation 150.00
402 Withholding tax (on EUR 1,650) 375.00
413 Employee's earnings-related pension insurance contribution (on EUR 1,000) 71.50
414 Employee's unemployment insurance contribution (on EUR 1,000) 15.00

Alternatively, the substitute payer can report the monetary wages it has paid in accordance with reporting method 1. The different ways of reporting monetary wages are described in greater detail in the instructions Reporting data to the Incomes Register: monetary wages and items deducted from wages.

In such a case, the substitute payer reports the data as follows:

Example 2, table 2/4
Earnings payment report submitted by substitute payer (reporting method 1 for monetary wages, alternative method)
Type of action: New report

Pay period

Payment date: 15.02.20xx

The start date of the pay period: 01.02.20xx

The end date of the pay period: 10.02.20xx

Payer (=substitute payer's) details

Type of identifier: Business ID

Identifier:77885544-8 (substitute payer’s customer ID)

Substitute payer data group

Acts as substitute payer: Yes

Employer's identifier type: Business ID or personal identity code

Employer identifier: 01010101-1 (actual employer's customer ID)

Income earner data

Type of identifier: Personal identity code (income earner's customer ID)

Identifier: ddmmyy-4321

Code Income type details EUR
101

Total wages

Type of insurance information:     

Subject to social insurance contributions:

Basis for insurance contribution: No

1650.00
103 Total wages subject to social insurance contributions 1000.00
402 Withholding tax (on EUR 1,650) 375.00
413 Employee's earnings-related pension insurance contribution (on EUR 1,000) 71.50
414 Employee's unemployment insurance contribution (on EUR 1,000) 15.00

The actual employer is obligated to report the income earner's wages on which the employer has paid social insurance contributions. Since only the contract pay (EUR 1,000) included in the wages paid by the substitute payer is subject to the employer's social insurance contributions, this is the amount that the actual employer must report on the actual employer's report:

Example 2, table 3/4

Actual employer’s report (earnings payment report)

Type of action: New report

Pay period (actual employer can report its own pay period)

Payment date: 15.02.20xx

The start date of the pay period:01.02.20xx

The end date of the pay period: 10.02.20xx

Payer (=actual employer's) details

Type of identifier: Business ID

Identifier: 01010101-1 (actual employer’s customer ID)

Payer type: Temporary employer

Income earner's details (+ name and address details and contact language)

Type of identifier: Personal identity code (income earner's customer ID)

Identifier: ddmmyy-4321

Occupational class: Statistics Finland's classification of occupations

Occupational class ID: NNNNN

Earnings-related pension insurance information Employee's earnings-related pension insurance

Pension provider code: NN

Pension policy number of earnings-related pension provider: NN-XXXXXXXX

Code Income type details EUR
321 Wages paid by substitute payer: employer pays for employer's social insurance contribution
Earnings period: 01.02.–28.02.20xx
1000.00

If a casual employer reports earnings payment data on a paper form or via the online form of the e-service, the employer submits only the earnings-related pension provider code on the report. If the data is reported via the technical interface or the upload service, the earnings-related pension provider's pension policy number intended for a casual employer must be submitted, in addition to the pension provider code.

Additionally, the employer must report on the employer's separate report the total amount of health insurance contributions it has paid on the basis of the wages.

The employer reports:

Example 2, table 4/4
Actual employer’s report (employer’s separate report)

Type of action: New report

Reporting date:05.03.20nn

Payer (=actual employer's) details

Type of identifier: Business ID

Identifier: 01010101-1 (actual employer’s customer ID)

Report information

Payment month: 02

Payment year: 20nn

Code Income type details EUR
102 Employer's health insurance contribution (total) 13.40

Example 3: Basic case, income is paid to a 16-year-old person.

The substitute payer pays a 16-year-old summer worker EUR 2,250 in time-rate pay on behalf of the actual employer. Since the income earner is 16, the income is not subject to earnings-related pension insurance or unemployment insurance contributions. However, the income is subject to the health insurance and occupational accident and occupational disease insurance contributions.

When submitting the substitute payer’s report, the substitute payer need not take a stand on social insurance, because the substitute payer is not responsible for paying the contributions.

The substitute payer reports:

Example 3, table 1/3

Substitute payer's earnings payment report

Type of action: New report

Pay period

Payment date: 01.04.20xx

The start date of the pay period: 01.04.20xx

The end date of the pay period: 30.04.20xx

Payer (=substitute payer's) details

Type of identifier: Business ID

Identifier: 1234567-8 (substitute payer’s customer ID)

Substitute payer data group

Acts as substitute payer: Yes

Employer's identifier type: Business ID or personal identity code

Employer identifier: 11223344-5 (actual employer's customer ID)

Income earner data

Type of identifier: Personal identity code (income earner's customer ID)

Identifier: ddmmyy-1111

Code Income type details EUR
201 Time-rate pay 2250.00
402 Withholding tax 450.00

Although the substitute payer need not take a stand on the social insurance contributions, the actual employer must provide all the relevant information needed for social insurance purposes on its report. Since the income is paid to a 16-year-old person, it is not subject to earnings-related pension insurance or unemployment insurance contributions. However, the income is subject to the health insurance and occupational accident and occupational disease insurance contributions. For this reason, the actual employer reports the data as follows:

Example 3, table 2/3
Actual employer’s report (earnings payment report)
Type of action: New report

Pay period (actual employer can report its own pay period)

Payment date: 01.04.20xx

The start date of the pay period: 01.04.20xx

The end date of the pay period: 15.04.20xx

Payer (=actual employer's) details

Type of identifier: Business ID

Identifier:11223344-5 (actual employer’s customer ID)

Income earner data

Type of identifier: Personal identity code (income earner's customer ID)

Identifier: ddmmyy-1111

Occupational class: Statistics Finland's classification of occupations

Occupational class ID: NNNNN

Type of exception to insurance: No obligation to provide insurance (unemployment insurance)

Type of exception to insurance: No obligation to provide insurance (earnings-related pension insurance)

Code Income type details EUR
324

Wages paid by substitute payer, employer pays for accident and occupational disease insurance contribution

Earnings period: 16.03.–31.03.20xx

2250.00
325

Wages paid by substitute payer, employer pays for employer's health insurance contribution

Earnings period: 16.03.–31.03.20xx

2250.00

Additionally, the employer must report on the employer's separate report the total amount of health insurance contributions paid on the basis of the wages.

The employer reports:

Example 3, table 3/3

Actual employer’s report (employer’s separate report)

Type of action: New report

Reporting date: 05.05.20nn

Payer (=actual employer's) details

Type of identifier: Business ID

Identifier: 8765432-1 (actual employer’s customer ID)

Report information

Payment month: 04

Payment year:20nn

Code Income type details EUR
102 Employer's health insurance contribution (total) 30.15

If the actual employer itself makes payments to the income earner in addition to the payments made by the substitute payer, the actual employer must also report those payments, the taxes withheld, and the employee's social insurance contributions collected.

Example 4: Actual employer itself also pays wages to the income earner.

A substitute payer has paid the income earner EUR 1,750 in time-rate pay on behalf of the actual employer. In addition to this, the actual employer has paid EUR 175 in overtime compensation.

The substitute payer reports to the Incomes Register the payments it has made:

Example 4, table 1/3

Earnings payment report submitted by substitute payer

Type of action: New report

Pay period

Payment date: 30.11.20xx

The start date of the pay period: 01.11.20xx

The end date of the pay period: 30.11.20xx

Payer (=substitute payer's) details

Type of identifier: Business ID

Identifier:1234567-8 (substitute payer’s customer ID)

Substitute payer data group

Acts as substitute payer: Yes

Employer's identifier type: Business ID

Employer identifier:8765432-1(actual employer's customer ID)

Income earner data

Type of identifier: Personal identity code (income earner's customer ID)

Identifier: ddmmyy-3322

Code Income type details EUR
201 Time-rate pay 1750.00
402 Withholding tax 350.00
413 Employee’s earnings-related pension insurance contribution (on EUR 1,750) 125.12
414 Employee’s unemployment insurance contribution (on EUR 1,750) 26.25

The actual employer must report the wages paid to the income earner by the substitute payer. If the substitute payer and the actual employer have paid income to the income earner on the same payment date, the actual employer can also report the payments it has made itself on the same report on which the wages paid by the substitute payer are reported.

The taxes withheld from the payments made by the actual employer and the employee's social insurance contributions collected must also be reported:

Example 4, table 2/3

Actual employer’s report (earnings payment report)

Type of action: New report

Pay period

Payment date: 30.11.20xx

The start date of the pay period: 01.11.20xx

The end date of the pay period: 30.11.20xx

Payer (=actual employer's) details

Type of identifier: Business ID

Identifier: 8765432-1 (actual employer’s customer ID)

Income earner data

Type of identifier: Personal identity code (income earner's customer ID)

Identifier: ddmmyy-3322

Occupational class: Statistics Finland's classification of occupations

Occupational class ID: NNNNN

Earnings-related pension insurance information Employee's earnings-related pension insurance

Pension provider code: NN

Pension policy number of earnings-related pension provider: NN-XXXXXXXX

Code Income type details EUR
321

Wages paid by substitute payer: employer pays for employer's social insurance contribution

Earnings period 01.11.–30.11.20xx

1750.00
325

Overtime compensation

Earnings period 16.11.–17.11.20xx

175.00
402 Withholding tax (on EUR 175) 35.00
413 Employee’s earnings-related pension insurance contribution (on EUR 175) 12.51
414 Employee’s unemployment insurance contribution (on EUR 175) 2.63

Additionally, the employer must report on the employer's separate report the total amount of the health insurance contributions paid on the basis of the wages paid by the substitute payer and the actual employer itself.

The employer reports:

Example 4, table 3/3

Actual employer’s report (employer’s separate report)

Type of action: New report

Reporting date: 05.12.20nn

Payer (=actual employer's) details

Type of identifier: Business ID

Identifier: 8765432-1 (actual employer’s customer ID)

Report information

Payment month: 11

Payment year: 20nn

Code Income type details EUR
102 Employer's health insurance contribution (total) 23.45

2.2. Wellbeing services county as a substitute payer (personal assistant and person requiring assistance)

Hiring a personal assistant involves employer obligations. Many wellbeing services counties have concluded agreements with persons requiring assistance (PRA) on the handling of employer obligations related to the payment of wages to a personal assistant.

A wellbeing services county acts as a substitute payer when it pays the personal assistant's wages from municipal funds. The wellbeing services county acting as a substitute payer reports in accordance with section 2.1. Often the wellbeing services county also handles other employer obligations on behalf of the PRA: for example, submits earnings payment reports and employer's separate reports to the Incomes Register and pays social insurance contributions to social insurance providers. The wellbeing services county here acts as an agent on behalf of the actual employer on the basis of an agreement, taking out insurances, paying insurance contributions and reporting data.

When the situation involves a substitute payer and the person requiring assistance is a minor, the details of the person requiring assistance are always reported to the Incomes Register as the actual employer details. This is done even if the possible contracts were made with the guardian.

In addition to wellbeig services counties, joint wellbeing services authorities can act as substitute payers.

Example 5: Wellbeing services county pays a personal assistant's wages.

In August, a a wellbeing services county pays EUR 1,000 in wages to a personal assistant and withholds EUR 200 in tax.

The wellbeing services county reports the payment to the Incomes Register as a substitute payer:

Example 5, table 1/3

Earnings payment report submitted by a a wellbeing services county as a substitute payer

Type of action: New report

Pay period

Payment date: 15.8.20xx

The start date of the pay period:01.08.20xx

The end date of the pay period: 31.8.20xx

Payer (=wellbeing services county as a substitute payer) details

Type of identifier: Business ID

Identifier: 77885544-8 (substitute payer’s customer ID)

Substitute payer data group

Acts as substitute payer: Yes

Employer's identifier type:Personal identity code (Finnish)

Employer identifier: ddmmyy-9999 (customer ID of PRA)

Income earner data

Type of identifier: Personal identity code

Identifier:ddmmyy-4321 (customer ID of personal assistant = income earner)

Code Income type details EUR
201 Time-rate pay 1000.00
402 Withholding tax 200.00
413 Employee’s earnings-related pension insurance contribution 71.50
414 Employee’s unemployment insurance contribution 15.00

For the purposes of determining and verifying the employer's social insurance contributions, the actual employer must report, on its own report, the wages paid by a substitute payer on which the employer pays the social insurance contributions. A wellbeing services county can act on behalf of the actual employer and report data to the Incomes Register if this has been agreed with the actual employer.

Example 5, table 2/3

Actual employer’s report (earnings payment report) submitted by a person requiring assistance (PRA) or by the wellbeing services county

Type of action: New report

Pay period

Payment date: 15.08.20xx

The start date of the pay period: 01.08.20xx

The end date of the pay period: 31.08.20xx

Payer (= PRA acting as actual employer) details

Type of identifier: Personal identity code

Identifier: ddmmyy-9999 (customer ID of PRA)

Income earner data

Type of identifier: Personal identity code

Identifier: ddmmyy-4321 (customer ID of personal assistant = income earner)

Occupational class: Statistics Finland's classification of occupations

Occupational class ID: NNNNN

Earnings-related pension insurance information Employee's earnings-related pension insurance

Pension provider code: NN

Pension policy number of earnings-related pension provider: NN-XXXXXXXX

Code Income type details EUR
321

Wages paid by substitute payer: employer pays for employer's social insurance contribution

Earnings period: 01.08.– 15.8.20xx

1000.00

The employer (or the municipality or wellbeing services county acting as an agent) must also report on an employer’s separate report the total amount of the employer’s health insurance contributions it has paid on the wages. Households must submit the employer’s separate report if they pay more than EUR 1,500 to the same income earner during a calendar year.

The employer (or the municipality or wellbeing services county acting as an agent) reports the following:

Example 5, table 3/3

Actual employer’s report (employer's separate report), submitted by a PRA or the wellbeing services county

Type of action: New report

Reporting date: 05.09.20nn

Payer (= PRA acting as actual employer) details

Type of identifier: Personal identity code

Identifier: ddmmyyyy-9999 (customer ID of PRA)

Report information

Payment month: 08

Payment year: 20nn

Code Income type details EUR
102 Employer's health insurance contribution (total) 13.40

2.3 Private day care allowance (wages)

As a substitute payer, Kela reports data on the wages it has paid to a caregiver who has an employment relationship with a family. In the case of private day care allowance, Kela acts as a substitute payer and does not pay social insurance contributions on the allowance. Further, Kela does not withhold the employee’s social insurance contributions from the payment.

A family member (family) is responsible for the employer obligations and social insurance contributions relating to a caregiver with an employment relationship, even as regards the private day care allowance. “Family member” refers to the person who submitted the application for private day care allowance to Kela.

The family member is also obligated to take out earnings-related pension insurance for the caregiver with an employment relationship and to pay the unemployment insurance contributions. The family member must also take out occupational accident and occupational disease insurance from an accident insurance company before the caregiver’s work commences. In the above situation, Kela will report in the substitute payer's report the details of the family member who is responsible for the employer obligations as the actual employer's details. The family member will take care of the employer obligations and report the wages paid and other earnings payment report data using the actual employer report. The family member will use the income types designated for the actual employer. It is important that the same family member who submitted the application for private day care allowance to Kela also concludes earnings-related pension and unemployment insurance policies. In addition, it is important to enter the same family member’s personal identity code as the payer on the actual employer’s report.

The earnings-related pension insurance contribution is divided into the employer’s and employee’s shares, which are both given as a percentage of the wages. The employee’s share is calculated on the basis of the total amount formed by the gross wages paid by the family member and the private day care allowance paid by Kela. However, the entire employee’s share is withheld by the family member from the wages paid to the caregiver. The earnings-related pension provider charges the employer for the entire earnings-related pension insurance contribution, including both the employer’s and employee’s shares. The corresponding procedure is applied to the unemployment insurance contribution. If the amount of wages paid to an employee is not sufficient to withhold the employee’s component, the family member pays the employee’s component to the earnings related pension provider and reports the employee’s components paid on the employee’s behalf as a fringe benefit using the Other fringe benefit (317) income type and as collected employee contributions using the Employee’s earnings-related pension insurance contribution (413) and Employee’s unemployment insurance contribution (414) income types.

The family member must report a private day care allowance regarded as wages received by a caregiver with an employment relationship, using the income type “Wages paid by substitute payer, employer pays social insurance contributions (321)”. Whether or not the family pays any other income to the caregiver is insignificant. The report must be submitted even if the family does not pay any other income. If the family pays other income to the caregiver during the same month, both the wages paid by the substitute payer and the payments made by the family can be reported on the same report.

Kela does not withhold the employee’s social insurance contributions from the payment it makes. The family withholds the employee’s contributions on the portion of the wages paid by the family and also on the portion paid by Kela. On the report it submits, the family must report the employee’s social insurance contributions both on the income it has paid and on the income paid by Kela.

It is important that the family member who submitted the application for private day care allowance to Kela concludes a pension insurance contract and reports data to the Incomes Register using their personal identity code. The data can be reported in the Incomes Register e-service or, for example, in Palkka.fi or a similar service that generates the necessary reports for the Incomes Register.

Example 6: Kela pays private day care allowance to a caregiver hired by a family. The family does not make payments to the income earner.

Kela pays EUR 300 to the caregiver. The family does not pay any other income to the caregiver.

Kela submits a substitute payer's report on the private day care allowance it has paid:

Example 6, table 1/3

Substitute payer's earnings payment report submitted by Kela

Type of action: New report

Pay period

Payment date: 15.02.20xx

The start date of the pay period: 01.02.20xx

The end date of the pay period: 10.2.20xx

Payer (=Kela as a substitute payer) details

Type of identifier: Business ID

Identifier: 11111111-1 (Kela's customer ID)

Substitute payer data group

Acts as substitute payer: Yes

Employer's identifier type: Personal identity code

Employer identifier: ddmmyy-9988 (family member’s customer ID)

Income earner data

Type of identifier: Personal identity code

Identifier: ddmmyy-6655(customer ID of caregiver = income earner)

Code Income type details EUR
355 Private day care allowance (wages) 300.00
402 Withholding tax 60.00

For the purposes of determining and verifying the employer's social insurance contributions, the family member acting as the actual employer must report, on its own report, the wages paid by Kela on which the employer pays the social insurance contributions.

Example 6, table 2/3

Actual employer’s report (earnings payment report) submitted by a family member

Type of action: New report

Pay period (Actual employer can report its own pay period)

Payment date: 15.02.20xx

The start date of the pay period: 01.02.20xx

The end date of the pay period: 28.02.20xx

Payer (= actual employer's) details

Type of identifier: Personal identity code

Identifier: ddmmyy-9988 (customer ID of family member = actual employer)

Income earner data

Type of identifier: Personal identity code

Identifier: ddmmyy-6655 (customer ID of caregiver = income earner)

Occupational class: Statistics Finland's classification of occupations

Occupational class ID: NNNNN

Earnings-related pension insurance information Employee's earnings-related pension insurance

Pension provider code: NN

Pension policy number of earnings-related pension provider: NN-XXXXXXXX

Code Income type details EUR
321 Wages paid by substitute payer: employer pays for employer's social insurance contribution 300.00
413 Employee's earnings-related pension insurance contribution (on EUR 300) 21.45
414 Employee's unemployment insurance contribution (on EUR 300) 4.50

A family member who acts as the employer must also use the employer’s separate report to report the total amount of the employer’s health insurance contribution they have paid on the basis of the wages paid by Kela if the household in question pays more than EUR 1,500 in wages to the same income earner  in a calendar year.

In such a case, the family member reports the amount of the employer’s health insurance contribution calculated from the wages (EUR 300) on which the health insurance contribution is based:

Example 6, table 3/3

Report by a family member acting as an actual employer (employer's separate report)

Type of action: New report

Reporting date: 05.03.20nn

Payer (= actual employer's) details

Type of identifier: Personal identity code

Identifier:ddmmyyyy-9988 (customer ID of family member = actual employer)

Report information

Payment month: 02

Payment year:20nn

Code Income type details EUR
102 Employer's health insurance contribution (total) 4.02

If the family also pays other income to the caregiver, that income must be reported to the Incomes Register as well. The family's other payments to the income earner can be reported on the same report that is used to report the wages paid by the substitute payer, if the payments are made  on the same payment date.

Example 7: The family pays wages to the caregiver in addition to the private day care allowance that is paid by Kela).

Kela pays EUR 300 to the caregiver. In addition, the family pays EUR 1,000 in wages to the caregiver.

Kela submits a substitute payer's report on the private day care allowance it has paid:

Example 7, table 1/3

Substitute payer's earnings payment report submitted by Kela

Type of action: New report

Pay period

Payment date: 15.02.20xx

The start date of the pay period: 01.02.20xx

The end date of the pay period: 10.2.20xx

Payer (=Kela as a substitute payer) details

Type of identifier: Business ID

Identifier: 11111111-1 (Kela's customer ID)

Substitute payer data group

Acts as substitute payer: Yes

Employer's identifier type: Personal identity code

Employer identifier: ddmmyy-9988 (family member’s customer ID)

Income earner data

Type of identifier: Personal identity code
Identifier: ddmmyy-6655 (customer ID of nanny = income earner)
Code Income type details EUR
355 Private day care allowance (wages) 300.00
402 Withholding tax 60.00

For the purposes of determining and verifying the employer's social insurance contributions, the family member acting as the actual employer must report, on its own report, the wages paid by Kela on which the employer pays the social insurance contributions.

The family must also report the wages it itself has paid to the income earner:

Example 7, table 2/3

Actual employer’s report (earnings payment report) submitted by a family member

Type of action: New report

Pay period (Actual employer can report its own pay period)

Payment date: 15.02.20xx

The start date of the pay period: 01.02.20xx

The end date of the pay period: 28.02.20xx

Payer (= actual employer's) details

Type of identifier: Personal identity code

Identifier: ddmmyy-9988 (customer ID of family member = actual employer)

Income earner data

Type of identifier: Personal identity code

Identifier: ddmmyy-6655 (customer ID of nanny = income earner)

Occupational class: Statistics Finland's classification of occupations

Occupational class ID: NNNNN

Earnings-related pension insurance information Employee's earnings-related pension insurance

Pension provider code: NN

Pension policy number of earnings-related pension provider:NN-XXXXXXXX

Code Income type details EUR
321

Wages paid by substitute payer: employer pays for employer's social insurance contribution

Earnings period: 01.02.–28.02.20xx

300.00
101 Total wages 1000.00
402 Withholding tax (on EUR 1,000) 200.00
413 Employee's earnings-related pension insurance contribution (on EUR 1,300) 92.95
414 Employee's unemployment insurance contribution (on EUR 1,300) 19.50

A family member who acts as the employer must also use the employer’s separate report to report the total amount of the employer’s health insurance contribution they have paid on the basis of the wages paid by Kela and the family, if the household in question pays more than EUR 1,500 in wages to the same recipient in a calendar year.

The family member reports the total amount of the employer’s health insurance contribution calculated from the wages (EUR 1,300) on which the health insurance contribution is based:

Example 7, table 3/3

Actual employer's report submitted by a family member (employer's separate report)

Type of action: New report

Reporting date: 05.03.20nn

Payer (= actual employer's) details

Type of identifier: Personal identity code

Identifier: ddmmyyyy-9988 (customer ID of family member = actual employer)

Report information

Payment month: 02

Payment year: 20nn

Code Income type details EUR
102 Employer's health insurance contribution (total) 17.42

2.4 Pay security and cases of bankruptcy situations

Applications for pay security are to be submitted to the Uusimaa Centre for Economic Development, Transport and the Environment (ELY Centre). The pay security system secures the payment of an employee’s receivables due to an employment relationship if the employer is unable to pay. However, pay security does not necessarily mean that a company is bankrupt, as it may only be experiencing temporary payment difficulties.An employee’s receivables due to an employment relationship, the grounds and amount of which have been identified, are paid as pay security. Pay security can be applied for by an employee or an employee association, to which the employee has assigned their receivables for collection. If the employer is bankrupt, the bankruptcy estate can also apply for pay security on behalf of employees in certain situations. The ELY Centre will recover the pay security paid from the employer, its bankruptcy estate and any other parties with liability to pay.

In bankruptcy cases, the substitute payer is either the ELY Centre (Section 2.4.1) or the bankruptcy estate (Section 2.4.2), depending on the situation.

When reporting, ensuring that the information is reported using the correct payer identifier is of particular importance:

  • In the case of lodged wage claims, indicate the Business ID of the debtor in bankruptcy as the payer’s Business ID on the actual employer’s report.
  • In the case of wage claims included in the liabilities of a bankruptcy estate, indicate the Business ID of the bankruptcy estate as the payer’s Business ID on the actual employer’s report.

Social insurers will use the identifier to determine what kind of wages are involved so that they can correctly determine the contributions.

Lodged wage claims comprise the receivables established before the bankruptcy until the date of the declaration of bankruptcy, including that date. In practice, lodged claims comprise all receivables normally paid in the final account such as holiday compensation.

Wage claims included in the liabilities of the bankruptcy estate comprise receivables established after the declaration of the bankruptcy, i.e. in practice generally only wages for the two-week period of notice including any incidentals. Holiday compensation is included in the liabilities of the bankruptcy estate only if it has been determined on a percentage basis during employment.

2.4.1 If the ELY Centre pays wages as pay security

When  the ELY Centre pays the employees' wages as pay security, the ELY Centre acts as a substitute payer. It will withhold taxes from the wages and deduct the employee's earnings-related pension insurance contribution and unemployment insurance contribution.

The ELY Centre submits earnings payment reports to the Incomes Register separately on every income earner no later than on the fifth day after the date of payment. The actual employer submits the income earner's earnings payment reports on the payment of wages paid by the ELY Centre as pay security to the Incomes Register, using the specific actual employer's income types for situations involving a substitute payer described in section 2.1 The actual employer also submits the employer's separate report. The actual employer’s reports (earnings payment reports and employer's separate reports) are submitted for each wage payment month no later than on the fifth day of the calendar month following the month of payment. The actual employer's reports are submitted using either the identifier of the actual employer (the debtor) or the identifier of the bankruptcy estate, depending on whether it is a case of lodged wage claims or wage claims included in the liabilities of the bankruptcy estate.

2.4.1.1 ELY Centre pays lodged wage claims

Lodged wage claims include wages and reimbursements established before the company was declared bankrupt.

Example 8: The ELY Centre pays the lodged wages claims.

The Uusimaa ELY centre pays the employee a wage claim of EUR 2,000. EUR 500 in income tax is withheld from the income. The ELY Centre reports the payment it has made to the Incomes Register. The claims were established before the bankruptcy.

Example 8, table 1/3

Substitute payer’s earnings payment report submitted by ELY Centre

Type of action: New report

Pay period

Payment date: 03.12.20xx

The start date of the pay period: 01.12.20xx

The end date of the pay period: 31.12.20xx

Payer (= ELY Centre) details

Type of identifier: Business ID

Identifier: 77885544-8 (Uusimaa ELY Centre’s customer ID)

Substitute payer data group

Acts as substitute payer: Yes

Employer's identifier type: Business ID or personal identity code

Employer identifier: 02020202-1 (actual employer's, i.e. debtor's, customer ID)

Paid as pay security: Yes

Income earner data

Type of identifier: Personal identity code (income earner's customer ID)

Identifier: ddmmyy-4321

Code Income type details EUR
201 Time-rate pay 2000.00
402 Withholding tax 500.00
413 Employee's earnings-related pension insurance contribution 143.00
414 Employee's unemployment insurance contribution 30.00

The ELY centre delivers the pay security decision to the Finnish Centre for Pensions. The Finnish Centre for Pensions delivers the pay security decision to the correct insurance provider on the basis of the actual employer’s customer ID (e.g. Business ID) and pension policy number.

The actual employer submits the earnings payment report and employer's separate report as follows:

Example 8, table 2/3
TYPE OF ACTION

Type of action: New report

Pay period

Payment date: 03.02.20xx

The start date of the pay period: 01.12.20xx

The end date of the pay period: 31.12.20xx

Payer (= actual employer's) details

Type of identifier: Business ID

Identifier: 02020202-1 (actual employer's , i.e. debtor's, customer ID)

Income earner data

Type of identifier: Personal identity code (income earner's customer ID)

Identifier: ddmmyy-1234

Occupational class: Statistics Finland's classification of occupations

Occupational class ID: NNNNN

Earnings-related pension insurance information Employee's earnings-related pension insurance

Pension provider code: NN

Pension policy number of earnings-related pension provider: NN-XXXXXXXX

Code Income type details EUR
321 Wages paid by substitute payer: employer pays for employer's social insurance contribution 2000.00

The pension and accident insurance information on the debtor (the actual employer) should be submitted on the report. The occupational accident insurance policy number must be submitted on the report only if the employees are insured with more than one accident and occupational disease insurance.

Example 8, table 3/3

Actual employer’s report (employer’s separate report)

Type of action: New report

Reporting date:05.01.20nn

Payer (= actual employer's) details

Type of identifier: Business ID

Identifier: 02020202-1 (actual employer's , i.e. debtor's, customer ID)

Report information

Payment month: 12

Payment year: 20nn

Code Income type details EUR
102 Employer's health insurance contribution (total) 26.80
2.4.1.2 The ELY Centre pays wage claims included in the liabilities of the bankruptcy estate.

The ELY Centre may also pay wage claims included in the liabilities of a bankruptcy estate as pay security on behalf of a bankruptcy estate. Wage claims included in the liabilities of the bankruptcy estate are receivables established after the declaration of bankruptcy.

Example 9: The ELY Centre pays wage claims included in the liabilities of a bankruptcy estate; the income earner was dismissed after a lay-off that lasted more than 200 days.

The ELY Centre pays, on behalf of the bankruptcy estate, the wages of an employee who was laid off for more than 200 days and was subsequently dismissed. The bankruptcy estate does not require the dismissed employee to work during the notice period. The ELY Centre submits a substitute payer’s report for the payment using the income type 208 Notice period compensation. The income is not subject to social insurance contributions. On the report in the substitute payer data group, the actual employer’s bankruptcy estate identifier is given (in a manner similar to example 8, where the identifier of the debtor in bankruptcy was given in Table 1).

The bankruptcy estate does not submit an actual employer’s earnings payment report for the payment, because the income is not subject to social insurance contributions. The employer’s separate report is submitted using the bankruptcy estate’s identifier.

Example 10: The ELY Centre pays a wage claim included in the liabilities of a bankruptcy estate; the bankruptcy estate does not require the employee to work during the notice period.

The ELY Centre pays the wages to the employee on behalf of the bankruptcy estate. The bankruptcy estate does not require the dismissed employee to work during the notice period. The ELY Centre submits a substitute payer’s report for the payment as when paying lodged wage claims (in a manner similar to example 8, where the identifier of the debtor in bankruptcy was given in Table 1).

The bankruptcy estate submits the actual employer’s earnings payment report using the bankruptcy estate’s identifier (see example 13, Table 1), reporting the earnings-related pension insurance information, the earnings-related pension provider code and the pension policy number. Occupational accident insurance liability is excluded by specifying the type of insurance exception: No obligation to provide insurance (accident and occupational disease insurance).

The following income types are used in the report:

  • 322 Wages paid by substitute payer: employer pays for employer’s earnings-related pension insurance contribution;
  • 323 Wages paid by substitute payer: employer pays for employer’s unemployment insurance contribution; and
  • 325 Wages paid by substitute payer: employer pays for employer’s health insurance contribution

The bankruptcy estate also submits an employer’s separate report using its own identifier.

In such a case, the bankruptcy estate also submits an earnings payment report using the identifier of the debtor in bankruptcy and the income type: 

  • 324 Wages paid by substitute payer: employer pays for accident and occupational disease insurance contribution

The report by the debtor in bankruptcy also includes information on classification of occupations. If more than one accident and occupational disease insurance policy has been taken out for the employees, the policy number of the accident and occupational disease insurance policy and the company identifier are also given.

2.4.2 The bankruptcy estate pays the wages (expedited pay security)

A bankruptcy estate can apply for pay security on behalf of the employees by submitting a joint application to the Uusimaa ELY Centre. Both lodged wage claims and wage claims included in the liabilities of the bankruptcy estate can be applied for as expedited pay security.

The bankruptcy estate applies for the gross amount of the wage receivables as pay security, with the employee's earnings-related pension and unemployment insurance contributions deducted. The pay security is paid to the account of the bankruptcy estate. The estate pays the wages to the employees, withholds taxes from the wages, and carries out any other remittances. The employer contributions and the employee's earnings-related pension and unemployment insurance contributions are either the employer's lodged claims or the bankruptcy estate's liabilities, depending on the receivables.

The bankruptcy estate submits the actual employer's reports using the identifier of the actual employer (the debtor) in the case of lodged wage claims and using the identifier of the bankruptcy estate in the case of wage claims included in the liabilities of the bankruptcy estate. If the bankruptcy estate continues the debtor's business activities and pays wages for work performed after the declaration of bankruptcy, the bankruptcy estate acts as the actual employer. In such a case, the bankruptcy estate submits both earnings payment reports and employer's separate reports using its own identifier (with the exception of the reporting of lodged wage claims described later in these instructions).

If the bankruptcy estate does not have the terminated employee work at all during the period of notice, the bankruptcy estate must submit two earnings payment reports to the Incomes Register so that the data is correctly delivered to the different insurers. See Section 2.4.2.3. for more detailed information on this exception.

2.4.2.1 Bankruptcy estate pays lodged wage claims

When a bankruptcy estate submits an application for the lodged wage claims of the income earners from the Uusimaa ELY Centre as an expedited procedure, the ELY Centre will pay the total amount of the receivables to the account of the bankruptcy estate. The bankruptcy estate pays the wages to the income earners, withholds taxes from the pay, and submits reports to the Incomes Register. In this case, the Uusimaa ELY Centre which granted the pay security will not submit any reports. In this situation, the bankruptcy estate acts as a substitute payer on behalf of the actual employer, i.e., the debtor. The ELY Centre deducts the employee's earnings-related pension and unemployment insurance contributions from the pay security paid to the bankruptcy estate, so the bankruptcy estate does not deduct them from the wages. However, they must be reported on a substitute payer's earnings payment report submitted by the bankruptcy estate.

The bankruptcy estate submits the reports to the Incomes Register as a substitute payer using its own Business ID (see Example 11, Table 1). The bankruptcy estate also submits the actual employer's reports. On the actual employer's report, the identifier of the actual employer that went bankrupt is submitted as the payer (see Example 11, Table 2).

When the bankruptcy estate pays wages in a situation involving expedited pay security, lodged wage claims and wage claims included in the liabilities of the bankruptcy estate cannot be reported on the same report, because the payer details that must be submitted are different. In the case of expedited pay security, some of the following reports are submitted depending on the circumstances:

  1. Substitute payer's earnings payment report (lodged wage claims)
  2. Actual employer's earnings payment report using the debtor's identifier (lodged wage claims)
  3. Actual employer's earnings payment report using the bankruptcy estate's identifier (wage claims included in the liabilities of the bankruptcy estate, see Section 2.4.2.3)
  4. Employer's separate report using the debtor's identifier
  5. Employer's separate report using the bankruptcy estate's identifier

See below for a description of the situations in which the reports must be submitted and which identifier is used.

Example 11: Expedited pay security, bankruptcy estate pays lodged wage claims.

The company was declared bankrupt on 1 March 20xx, and the wages for that year have not been paid to the employees. The wages for the period 1 January to 1 March 20xx are lodged wage claims, while the wages from 2 March to 15 March are wage claims included in the liabilities of the bankruptcy estate. An income earner is paid EUR 2,000, of which EUR 1,700 are lodged wage claims for the period from 1 January to 1 March 20xx, and EUR 300 are wage claims included in the liabilities of the bankruptcy estate for the period from 2 March to 15 March 20xx. (See example 12 for a description of how to report wage claims included in the liabilities of the bankruptcy estate.)

The bankruptcy estate has applied for pay security for paying the lodged wage claims and the wage claims included in the liabilities of the bankruptcy estate on behalf of the employees, by submitting a joint application to the Uusimaa ELY Centre. The pay security is paid to the account of the bankruptcy estate. The estate administrator pays the net wages to the recipients on 15 March and remits the withheld taxes to the Tax Administration.

The lodged wage claims are from the time before the bankruptcy. The substitute payer’s report is submitted using the bankruptcy estate’s Business ID (example 11, Table 1). The actual employer’s earnings payment report is submitted using the Business ID and insurance information of the actual employer, i.e., the debtor (example 11, Table 2).

Example 11, table 1/3

Substitute payer's earnings payment report using the bankruptcy estate's identifier

Type of action: New report

Pay period

Payment date: 15.03.20xx

The start date of the pay period: 01.01.20xx

The end date of the pay period: 01.03.20xx

Payer (=bankruptcy estate's) details

Type of identifier: Business ID

Identifier: 01010101-2 (bankruptcy estate’s customer ID)

Substitute payer data group

Acts as substitute payer: Yes

Employer's identifier type: Business ID or personal identity code

Employer identifier: 02020202-1 (actual employer's , i.e. debtor's, customer ID)

Income earner data

Type of identifier: Personal identity code (income earner's customer ID)

Identifier: ddmmyy-4321

Code Income type details EUR
201 Time-rate pay 1700.00
402 Withholding tax 500.00
413 Employee's earnings-related pension insurance contribution 121.55
414 Employee's unemployment insurance contribution 25.50

On the actual employer's report, the bankruptcy estate submits the Business ID and insurance information of the actual employer, i.e., the debtor, as the payer details (Example 11, Table 2).

Example 11, table 2/3

Actual employer's report submitted using the identifier of the debtor in bankruptcy (earnings payment report)

Type of action: New report

Pay period

Payment date: 15.03.20xx

The start date of the pay period: 01.01.20xx

The end date of the pay period: 01.03.20xx

Payer (= actual employer's) details

Type of identifier: Business ID

Identifier: 02020202-1 (actual employer's , i.e. debtor's, customer ID)

Income earner data

Type of identifier: Personal identity code (income earner's customer ID)

Identifier: ddmmyy-1234

Occupational class: Statistics Finland's classification of occupations

Occupational class ID: NNNNN

Earnings-related pension insurance information Employee's earnings-related pension insurance

Pension provider code: NN

Pension policy number of earnings-related pension provider: NN-XXXXXXXX

Code Income type details EUR
321 Wages paid by substitute payer: employer pays for employer's social insurance contribution 1700.00

The actual employer, i.e., the debtor, is liable to pay the health insurance contributions for the lodged wage claims. The bankruptcy estate submits an employer's separate report using the Business ID of the actual employer (debtor):

Example 11, table 3/3

Actual employer's report: bankruptcy estate’s identifier (employer’s separate report)

Type of action: New report

Reporting date: 05.04.20nn

Payer (= actual employer's) details

Type of identifier: Business ID

Identifier:02020202-1 (customer ID of debtor in bankruptcy)

Report information

Payment month: 03

Payment year: 20nn

Code Income type details EUR
102 Employer's health insurance contribution (total) 22.78
2.4.2.2 Bankruptcy estate pays wage claims included in the liabilities of the bankruptcy estate

Wage claims included in the liabilities of the bankruptcy estate comprise receivables established after the declaration of the bankruptcy, i.e., in practice generally only the wages for the two-week period of notice including any incidentals. Holiday compensation is included in the liabilities of the bankruptcy estate only if it has been determined on a percentage basis during the employment.

When wage claims included in the liabilities of the bankruptcy estate are involved, it is not an actual substitute payer situation. The bankruptcy estate pays the wages from the estate assets and is also obligated to take out earnings-related pension and occupational accident insurances. The bankruptcy estate submits an earnings payment report to the Incomes Register using its own Business ID. The details (pension policy number and occupational accident insurance policy number) of the insurance policies taken out by the bankruptcy estate for the wage claims included in the liabilities of the bankruptcy estate are submitted on the report (however, see Section 2.4.2.3. if no work is performed during the period of notice). The occupational accident insurance policy number must be submitted on the report only if the employees are insured with more than one accident and occupational disease insurance. The data is reported on a regular earnings payment report in accordance with Example 12 (Table 1).

Example 12: The bankruptcy estate pays the wage claims included in its liabilities.

The company was declared bankrupt on 1 March 20xx, and the wages for that year have not been paid to the employees. The wages for the period 1 January to 1 March 20xx are lodged wage claims, while the wages from 2 March to 15 March are wage claims included in the liabilities of the bankruptcy estate. An income earner is paid EUR 2,000, of which EUR 1,700 are lodged wage claims for the period from 1 January to 1 March 20xx, and EUR 300 are wage claims included in the liabilities of the bankruptcy estate for the period from 2 March to 15 March 20xx. (Lodged wage claims are reported in accordance with example 11.)

The bankruptcy estate has applied for pay security for paying the lodged wage claims and the wage claims included in the liabilities of the bankruptcy estate on behalf of the employees by submitting a joint application to the Uusimaa ELY Centre. The pay security is paid to the account of the bankruptcy estate. The estate administrator pays the net wages to the recipients on 15 March and remits the withheld taxes to the Tax Administration.

Example 12, table 1/2

The earnings payment report submitted by the bankruptcy estate

Type of action:New report

Pay period

Payment date: 15.03.20xx

The start date of the pay period: 02.03.20xx

The end date of the pay period: 15.03.20xx

Payer (= bankruptcy estate) details

Type of identifier: Business ID

Identifier: 01010101-2 (the bankruptcy estate's customer identifier)

Income earner details

Type of identifier: Personal identity code (income earner's customer ID)

Identifier: ddmmyy-4321

Occupational class: Statistics Finland's classification of occupations

Occupational class ID: NNNNN

Earnings-related pension insurance information Employee's earnings-related pension insurance

Pension provider code: NN

Pension policy number of earnings-related pension provider: NN-XXXXXXXX

Code Income type details EUR
201 Time-rate pay 300.00
402 Withholding tax 50.00
413 Employee's earnings-related pension insurance contribution 21.45
414 Employee's unemployment insurance contribution 4.50

The bankruptcy estate also calculates the employer's health insurance contribution from the wage claims included in its liabilities, pays it out of the bankruptcy estate's assets, and submits an employer's separate report using the bankruptcy estate's Business ID.

Example 12, table 2/2

The employer's separate report submitted by the bankruptcy estate

Type of action:New report

Reporting date: 05.04.20nn

Payer (= bankruptcy estate) details

Type of identifier: Business ID

Identifier: 01010101-2 (the bankruptcy estate's customer identifier)

Report information

Payment month: 03

Payment year: 20nn

Code Income type details EUR
102 Employer's health insurance contribution (total) 4.02
2.4.2.3  Exception: the bankruptcy estate does not have the terminated employee work

If the bankruptcy estate does not require the dismissed employee to work at all during the period of notice, the bankruptcy estate must submit two earnings payment reports to the Incomes Register for the wage claims included in its liabilities to ensure that the information will be correctly transmitted to the various data users. The bankruptcy estate submits an earnings payment report using its own customer identifier, specifying that it does not have the obligation to provide occupational accident insurance (see example 13, Table 1). From this report, the data is transmitted to, for example, the Tax Administration, the Employment Fund, and the earnings-related pension provider. The bankruptcy estate also submits a second earnings payment report using the debtor’s customer identifier, reporting the same wages using income type 324 ‘Wages paid by substitute payer: employer pays for accident and occupational disease insurance contribution’ (see example 13, Table 2). From this report, the information will be transmitted to the accident insurance company.

Example 13: Wage claims included in the liabilities of the bankruptcy estate reported by the bankruptcy estate when the bankruptcy estate does not require the dismissed employee to work.

The bankruptcy estate submits two earnings payment reports: one using its own Business ID and the other using the debtor's Business ID.

The earnings payment report using the bankruptcy estate's identifier:

The bankruptcy estate submits an earnings payment report to the Incomes Register using its own Business ID. Type of insurance exception: no obligation to provide insurance (accident and occupational disease insurance) entry is submitted on the report. The details of the insurance taken out by the bankruptcy estate, earnings-related pension provider code, and pension policy number are submitted on the report.

Example 13, table 1/3

The earnings payment report using the bankruptcy estate's identifier

Type of action:New report

Pay period

Payment date: 15.03.20xx

The start date of the pay period: 02.03.20xx

The end date of the pay period: 15.03.20xx

Payer (= bankruptcy estate) details

Type of identifier: Business ID

Identifier: 01010101-2 (the bankruptcy estate's customer identifier)

Income earner details

Type of identifier: Personal identity code (income earner's customer ID)

Identifier: ddmmyy-1234

Earnings-related pension insurance information Employee's earnings-related pension insurance

Pension provider code: NN

Pension policy number of earnings-related pension provider: NN-XXXXXXXX

Type of exception to insurance:No obligation to provide insurance (accident and occupational disease insurance)

Code Income type details EUR
201 Time-rate pay 300.00
402 Withholding tax 50.00
413 Employee's earnings-related pension insurance contribution 21.45
414 Employee's unemployment insurance contribution 4.50

The earnings payment report using the debtor's identifier:

The bankruptcy estate submits an earnings payment report to the Incomes Register using the debtor's Business ID for the occupational accident insurance company. The details of the debtor's occupational accident insurance policy are submitted on the report, and income type 324 ‘Wages paid by substitute payer, employer pays for accident and occupational disease insurance contribution’ is used. The occupational accident insurance policy number must be submitted on the report only if the employees are insured with more than one accident and occupational disease insurance.

Example 13, table 2/3

The earnings payment report using the debtor's identifier

Type of action: New report

Pay period

Payment date: 15.03.20xx

The start date of the pay period: 02.03.20xx

The end date of the pay period: 15.03.20xx

Payer (= debtor) details

Type of identifier: Business ID

Identifier: 02020202-1 (Customer identifier of the actual employer, i.e. debtor)

Income earner details

Type of identifier: Personal identity code (income earner's customer ID)

Identifier: ddmmyy-1234

Occupational class:Statistics Finland's classification of occupations

Occupational class ID:NNNNN

Code Income type details EUR
324 Wages paid by substitute payer, employer pays for accident and occupational disease insurance contribution 300.00

In an exceptional situation, the bankruptcy estate also has the obligation to pay the employer's health insurance contribution, so the employer's separate report is submitted using the bankruptcy estate's Business ID.

Employer's separate report using the bankruptcy estate's identifier:

Example 13, table 3/3

Employer's separate report using the bankruptcy estate's identifier

Type of action:New report

Reporting date: 05.04.20nn

Payer (= bankruptcy estate) details

Type of identifier: Business ID

Identifier: 01010101-2 (the bankruptcy estate's customer identifier)

Report information

Payment month: 03

Payment year: 20nn

Code Income type details EUR
102 Employer's health insurance contribution (total) 4.02
2.4.2.4 Employer's separate report in bankruptcy situations

When lodged wage claims are paid, the employer's separate report is submitted using the debtor's Business ID. When wage claims included in the liabilities of the bankruptcy estate are paid, such as wages for the period of notice, the report is submitted using the bankruptcy estate's Business ID.

Example 14: Submitting an employer's separate report for lodged wage claims and wage claims included in the liabilities of the bankruptcy estate

Employer's separate report for lodged wage claims using the debtor's identifier:

In the example, there were EUR 1,700 of lodged wage claims.

Example 14, table 1/2

Employer's separate report for lodged wage claims using the debtor's identifier

Type of action: New report

Reporting date: 05.04.20nn

Payer (=debtor) details

Type of identifier: Business ID

Identifier: 02020202-1 (the debtor's customer identifier)

Report information

Payment month: 03

Payment year: 20nn

Code Income type details EUR
102 Employer's health insurance contribution (total) 22.78

Employer's separate report for wage claims included in the liabilities of the bankruptcy estate using the bankruptcy estate's identifier:

In the example, there were EUR 300 of wage claims included in the liabilities of the bankruptcy estate.

Example 14, table 2/2

Employer's separate report for wage claims included in the liabilities of the bankruptcy estate using the bankruptcy estate's identifier

Type of action: New report

Reporting date: 05.04.20nn

Payer (=bankruptcy estate) details

Type of identifier: Business ID

Identifier: 01010101-2 (the bankruptcy estate's customer identifier)

Report information

Payment month: 03

Payment year: 20nn

Code Income type details EUR
102 Employer's health insurance contribution (total) 4.02

If a company is declared bankrupt in the middle of a month, two employer's separate reports must be submitted for the month during which the bankruptcy was declared. The debtor's Business ID is used to report the total amount of health insurance contributions until the declaration of bankruptcy, and the bankruptcy estate's Business ID is used to report the amount of health insurance contributions from the time after the bankruptcy.

Example 15: Submitting an employer's separate report when bankruptcy is declared in the middle of the month.

The company is declared bankrupt on 15 August 20xx. The actual employer, i.e., the debtor, reports August as the reporting period of the employer's separate report and reports the total amount of health insurance contributions for the period from 1 to 15 August 20xx. The bankruptcy estate also reports August as the reporting period of its own report, and reports the total amount of health insurance contributions for the period from 16 to 31 August 20xx.

2.4.3 Konkurssitilanteiden ilmoitukset taulukossa

The table describes the reports to be submitted in various situations involving the paying of pay security and bankruptcy.

Table on submitting earnings payment reports.
Pay security pays the wages payable based on applications submitted by the employees themselves
1. Substitute payer's report (the Uusimaa ELY Centre pays the wages as pay security and submits the report)

Payer’s business ID:Business ID of the Uusimaa ELY Centre

Income type: 100 and 200 series income types

Pension policy number and accident insurance policy number*: Not provided.

2. Actual employer's report (time before bankruptcy, lodged claims)

Payer’s business ID:Business ID of the bankrupt employer

Income type: 321 Wages paid by substitute payer: the employer pays for the employer's social insurance contributions (earnings-related pension, health, unemployment, and accident and occupational disease insurance)

Pension policy number and accident insurance policy number*: The pension policy number and the accident insurance policy number of the bankrupt employer

3. Actual employer's report (time after bankruptcy, wage claims included in the liabilities of the bankruptcy estate)

Payer’s business ID:Business ID of the bankruptcy estate

Income type: 321 Wages paid by substitute payer: the employer pays for the employer's social insurance contributions (earnings-related pension, health, unemployment, and accident and occupational disease insurance)

Pension policy number and accident insurance policy number*: Pension policy number of the insurance taken out by the bankruptcy estate and the accident insurance policy number

Expedited pay security, wages payable are pay security that the bankruptcy estate distributes to the employees: Lodged claims

1. Substitute payer's report (bankruptcy estate submits the report)

Payer’s business ID:Business ID of the bankruptcy estate

Income type: 100 and 200 series income types

Pension policy number and accident insurance policy number*: Not provided.

2. Actual employer's report (bankruptcy estate submits the report on behalf of the debtor)

Payer’s business ID:Business ID of the bankrupt employer

Income type: 321 Wages paid by substitute payer: the employer pays for the employer's social insurance contributions (earnings-related pension, health, unemployment, and accident and occupational disease insurance)

Pension policy number and accident insurance policy number*: The pension policy number and the accident insurance policy number of the bankrupt employer

Expedited pay security, wages payable are pay security that the bankruptcy estate distributes to the employees: Claims included in the liabilities of the bankruptcy estate

1. Bankruptcy estate's earnings payment report

Payer’s business ID:Business ID of the bankruptcy estate

Income type: 100 and 200 series income types

Pension policy number and accident insurance policy number*: The pension policy number of the insurance taken out by the bankruptcy estate and the accident insurance policy number

Exception: bankruptcy estate does not have the terminated employee work during the period of notice, but pays the wages for the period of notice as wage claims included in the liabilities of the bankruptcy estate

1. Bankruptcy estate's earnings payment report

Payer’s business ID:Business ID of the bankruptcy estate

Income type: 100 and 200 series income types

Pension policy number and accident insurance policy number*: The pension policy number of the insurance taken out by the bankruptcy estate

Type of exception to insurance: No obligation to provide insurance: (accident and occupational disease insurance)

2. Debtor's earnings payment report

Payer’s business ID:Business ID of the bankrupt employer

Income type: 324 Wages paid by substitute payer, employer pays for accident and occupational disease insurance contribution

Pension policy number and accident insurance policy number*: The accident insurance policy number of the bankrupt employer

Wages payable, no pay security (bankruptcy estate pays the wages from its own assets)

1. Substitute payer's report (time before bankruptcy, lodged claims)

Payer’s business ID:Business ID of the bankruptcy estate

Income type: 100 and 200 series income types

Pension policy number and accident insurance policy number*: Not provided.

2. Actual employer's report (time before bankruptcy, lodged claims)

Payer’s business ID:Business ID of the bankrupt employer

Income type: 321 Wages paid by substitute payer: the employer pays for the employer's social insurance contributions (earnings-related pension, health, unemployment, and accident and occupational disease insurance)

Pension policy number and accident insurance policy number*: The pension policy number and the accident insurance policy number of the bankrupt employer

3. Actual employer's report (time after bankruptcy, NB: this is not an actual substitute payer situation)

Payer’s business ID:Business ID of the bankruptcy estate

Income type: 100 and 200 series income types if the situation does not involve a substitute payer

Pension policy number and accident insurance policy number*: The pension policy number of the insurance taken out by the bankruptcy estate and the accident insurance policy number

* The occupational accident insurance policy number must be submitted on the report only if the employees are insured with more than one accident and occupational disease insurance policy.

2.4.4 Paying of distributable shares

Once a bankruptcy estate has been cleared, the following reports of payable distributable shares are usually submitted to the Incomes Register:

  • Substitute payer’s earnings payment report with the bankruptcy estate’s Business ID so that the substitute payer data group contains the debtor’s Business ID as the actual employer’s identifier
  • Actual employer’s earnings payment report with the debtor’s Business ID so that the paid sum is reported using income types 321–325 for situations involving a substitute payer based on the contributions applicable to the paid income
  • Employer’s separate report with the debtor’s Business ID

Social insurance contributions are usually not levied from distributable shares,however, the employer’s health insurance contribution is an exception. Read more in the Finnish Tax Administration’s instructions for bankruptcy estate administrators (in Finnish).  In addition, the unemployment contributions should only be levied if, exceptionally, a full distributable share is accrued for a wage claim.

If a social insurance contribution is not to be levied on a distributable share only because a full distributable share is not accrued, the ‘Type of insurance exception’ data is not to be used in the report. This data is only reserved for situations where the payer is not obliged to insure the income earner because of a factor such as the income earner’s age. Such an exception to the insurance requirement does usually not apply to distributable shares. If the full distributable share is not accrued for the claim and the payer is not obliged to insure the income earner for another reason, such as age, the types of insurance exceptions are normally reported according to the instructions for the Incomes Register. For more information, see recommendation 04 of the Advisory Board on Bankruptcy Affairson employment issues in bankruptcy.

If the bankruptcy estate does not collect a social insurance contribution because the full distributable share is not accrued for the claim, the income type of this social insurance contribution is not to be included in the earnings payment report at all.

Example 16: Distributable share of a lodged wage claim

A bankruptcy estate pays a distributable share of EUR 1,000 in lodged wage claims for which the full distributable share is not accrued. The bankruptcy estate submits a substitute payer’s earnings payment report with the details of the debtor in bankruptcy in the ‘Substitute payer’ data group. The bankruptcy estate does not charge an earnings-related pension insurance contribution or unemployment insurance contribution on the payment, which means that the bankruptcy estate does not include the income types 413 Employee employment pension insurance contribution or 414 Employee’s earnings-related pension insurance contribution or 414 Employee’s unemployment insurance contribution in the earnings payment report.

The bankruptcy estate also submits an actual employer’s earnings payment report on behalf of the debtor. The debtor’s Business ID and the following income types reserved for substitute payers are to be used in the report:

322 Wages paid by substitute payer: employer pays for employer’s earnings-related pension insurance contribution;

324 Wages paid by substitute payer: employer pays for accident and occupational disease insurance contribution

325 Wages paid by substitute payer: employer pays for employer’s health insurance contribution

The employer’s separate report is also submitted using the debtor’s identifier.

Because a full distributable share is not accrued for wages paid as distributable shares, the bankruptcy estate does not pay any unemployment insurance contribution. Therefore, income type 321 or 323 is not exceptionally used in this situation so that the data is also transmitted correctly to the Employment Fund. If a full distributable share is accrued for wage claims, the bankruptcy estate must pay unemployment insurance contributions and enter income type 321 or 323.

2.5 Correcting data in situations involving a substitute payer

The payer is responsible for the accuracy and correction of any data they have submitted to the Incomes Register. In cases involving a substitute payer, correcting may require action by both the substitute payer and the actual employer. In many cases, the substitute payer has to correct the substitute payer’s earnings payment report and the actual employer has to correct the actual employer’s earnings payment report and employer’s separate report. Which reports need to be corrected and by whom depends on each individual situation.

As a rule, data in the Incomes Register is corrected by submitting a replacement report with the same payment date as the original report. The replacement report must include all the information that was correct in the first report, and any new or changed information. The correction is matched with the original report with a report reference. Income cannot be corrected using negative values, i.e. amounts preceded by a minus sign.

In some cases, the previous report must be cancelled before submitting a whole new report. The original report must be cancelled if the payment date, the pay period or the actual employer’s customer identifier given in the ‘Substitute payer’ data group is corrected, for example. For more information on correcting data by means of cancellation, see Correcting data in the Incomes Register, Section 6.

Read more about the correction of data in Correcting data in the Incomes Register. Next, these instructions describe in more detail situations involving a substitute payer and an unjust enrichment and recovery.

2.5.1 Substitute payer has overpaid income (unjust enrichment and recovery)

A payment made by a substitute payer may become, in whole or in part, an unjust enrichment if, for example, an overpayment of income has taken place. An unjust enrichment is usually recovered from the income earner. Gross or net recovery may be used. When the income earner returns the overpayment to the payer, the repayment must be reported to the Incomes Register with a new report.

For more information on the differences between gross and net recovery and how to report recovery, see Correcting data in the Incomes Register.

The procedure for reporting an unjust enrichment and recovery to the Incomes Register is slightly different in the case of a substitute payer.

When the overpayment is noticed, i.e. when the income paid by the substitute payer becomes an unjust enrichment:

  • The earnings payment report submitted by the actual employer must be corrected
  • The employer’s separate report submitted by the actual employer must be corrected
  • Correcting the original report by the substitute payer is not mandatory

When the income earner has returned the overpaid amount:

  • The substitute payer must submit a new report for the recovered amount
  • The actual employer need not report anything

The reason for this correction procedure is that a payment that has become an unjust enrichment is not income subject to social insurance contributions. In the case of a substitute payer, the social insurance contributions are determined on the basis of the report submitted by the actual employer, so that is what needs to be corrected. The employer’s separate report must also be corrected if the employer’s health insurance contribution changes. In cases not involving a substitute payer, all the original reports must always be corrected according to the general Incomes Register instructions.

Corrections in case of a substitute payer may require communication between the substitute payer and the actual employer.

2.5.1.1 Actual employer corrects original reports

When the overpayment is noticed, the actual employer must correct the earnings payment report it submitted to the Incomes Register to ensure that the social insurance contributions are correctly determined. The report corrects the income types used in case of substitute payers, 321–325. The amount of income subject to social insurance contributions must be corrected. The ‘Unjust enrichment’ data linked to the income type must not be used when correcting the data. If the entire payment becomes an unjust enrichment, the amount of the income type must be changed to EUR 0. The actual employer must also correct the employer’s separate report if the employer’s health insurance contribution to be paid changes.

2.5.1.2 Substitute payer submits a new report on recovery

Once the income earner has paid back the overpayment, the substitute payer must submit a new report to the Incomes Register on the recovered amount. This means that amount is not corrected in the original report.

The following information on the recovered income is provided:

  • Income type
  • Recovery – Yes
  • Recovered amount
  • Recovery date
  • Withholding from the recovered amount (if net recovery) or tax at source from the recovered amount (if net recovery)
  • Original pay period

Additionally, the following information on the recovered income may be provided as complementary additional data:

  • Earnings period of the recovered income
  • Original payment date

Read more about the reporting of recovery in Correcting data in the Incomes Register.

2.5.2 Reporting recovery: wellbeing services county, ELY Centre or bankruptcy estate as substitute payer

If the overpayment was made by a wellbeing services county, an ELY Centre (in case of pay security) or a bankruptcy estate, the income must be recovered from the income earner to whom the payment was originally paid.

When a wellbeing services county is the substitute payer and recovers wages paid to a personal assistant, the wellbeing services county submits a new substitute payer’s report on the recovery. In addition, the wellbeing services county corrects the income types for substitute payers in the actual employer’s report it has submitted.  The wellbeing services county also corrects the employer’s separate report on behalf of the person being assisted.

When an ELY Centre is the substitute payer and recovers a payment paid as pay security or a part thereof from an income earner, the ELY Centre submits a new substitute payer’s report on the recovery. Furthermore, the actual employer corrects the income types for substitute payers reported on the earnings payment report and also the employer’s separate report it has submitted, if necessary.

When a bankruptcy estate is the substitute payer on behalf of a debtor in bankruptcy and recovers a payment or a part thereof from an income earner, the bankruptcy estate submits a new substitute payer’s report on the recovery. The income types for substitute payers reported using the identifier of the debtor, i.e. the actual employer, also need to be corrected. The employer’s separate report may also need to be corrected.

Example 17: In August, a substitute payer paid an income earner EUR 1,000 on behalf of the actual employer, and withheld EUR 200 in taxes. A substitute payer’s report, the actual employer’s earnings payment report using the income type 321 ‘Wages paid by substitute payer: the employer pays for the employer’s social insurance contributions’ and the actual employer’s separate report were submitted to the Incomes Register for the payment.

The entire payment made by the substitute payer is recovered from the income earner as a net recovery in September. The substitute payer submits a new report on the recovery of the payment once the income earner has paid back the entire sum.

The actual employer submits a replacement report where the reported sum subject to social insurance contributions is corrected using income type 321. Furthermore, the actual employer corrects the employer’s separate report.

New earnings payment report by a substitute payer on recovery

Example 17, table 1/3
New earnings payment report by a substitute payer on recovery

Action type: New report

Pay period

Payment date or other report date: 15 September 20xx

Start date of the pay period: 1 September 20xx

The end date of the pay period: 30 September 20xx

Details of the payer (=substitute payer)

Type of identifier: Business ID

Identifiere: 77885544-8 (substitute payer’s customer identifier)

Substitute payer data group

Acts as substitute payer: Yes

Employer identifier type: Business ID

Employer identifier: 1234567-8 (actual employer’s customer identifier)

Details of the income earner

Type of identifier: Personal identity code

Identifier: ddmmyyyy-4321

Code Income type details EUR
201 Time-rate pay 1000.00
 

Recovery Yes

Earnings period: 1 August 20xx to 30 August 20xx*

 
  Additional information on recovery  
 

Recovery date 15 September 20xx

Withholding from the recovered amount

Original pay period: 1 August to 30 August 20xx

Original payment date15 August 20xx*

 

200.00

* The earnings period and the original payment date are complementary additional data; however, providing them is recommended. The additional recovery data ‘Original pay period’ is mandatory. The original pay period to be reported in additional recovery details refers to the pay period during which the payment subject to recovery was originally paid to the income earner.

Example 17, table 2/3
Actual employer’s replacement earnings payment report

Action type: Replacement report

Pay period

Payment date or other report date: 15 August 20xx

Start date of the pay period: 1 August 20xx

End date of the pay period: 31 August 20xx

Details of the payer (=actual employer)

Type of identifier: Business ID

Identifier: 1234567-8

Details of the income earner

Type of identifier: Personal identity code

Identifier: ddmmyy-4321

Occupational class: Statistics Finland’s classification of occupations

Occupational class ID: NNNNN

Earnings-related pension insurance information: Employee’s earnings-related pension insurance contribution

Earnings-related pension provider code: NN

Pension arrangement number of employment pension institution:  NN-XXXXXXXX

Code Income type details EUR
321 Wages paid by the substitute payer for which the employer pays the employer’s social insurance contributions 0.00
  Earnings period: 1 August to 15 August 20xx/strong>  
Example 17, table 3/3

Actual employer’s separate replacement report

Action type: Replacement report

Reporting date: 115 September 20xx

Details of the payer (=actualy employer)

Type of identifier: Business ID

Identifier: 1234567-8

Report details

Payment month: 08

Payment year: 20xx

Code Income type details EUR
102 Employer’s health insurance contribution (total) 0.00

* If no other payments have been made by the actual employer during the reporting period, the employer’s health insurance contribution is corrected to EUR 0, as no employer’s health insurance contribution is to be paid for an unjust enrichment. If the employer has also paid income subject to the employer’s health insurance contribution during the same period, the unjust enrichment will be deducted from the total health insurance contribution.

2.5.3 Reporting recovery: Kela as substitute payer

When Kela recovers a private day care allowance, the income is recovered from the family even though the benefit was paid to a nanny employed by the family. The nanny will pay the benefit to the family, and the nanny or a family member will notify Kela of the repayment. Kela will then report the recovery of the private day care allowance to the Incomes Register. The nanny must return the gross amount of the private day care allowance even if they received a net payment. The nanny or a family member must contact Kela and submits a payment receipt and a report of the recovery. The necessary clarifications should be sent as email attachments to  vekki@kela.fi.

Kela will submit a new substitute payer’s report to the Incomes Register where Kela reports the recovery of the income. The family member must correct the amount of the income type “321 Wages paid by substitute payer: the employer pays for the employer’s social insurance contributions” on the actual employer’s earnings payment report. If the entire private day care allowance paid by the substitute payer is considered an unjust enrichment, the amount of the income type is reported as EUR 0. If only part of the private day care allowance is an unjust enrichment, the amount of the unjust enrichment is deducted from the amount reported for the income type.

The family member must also correct the employer’s separate report if the family has submitted a separate report of the private day care allowance to the Incomes Register. A family member who acts as the employer must use the employer’s separate report to report the total amount of the employer’s health insurance contribution they have paid on the basis of the wages paid by Kela if the family member in question pays more than EUR 1,500 in wages to the same income earner during a calendar year. If the income becomes an unjust enrichment, it is not included in the amount.

Example 18: Kela has originally paid a private day care allowance of EUR 300 (see example 6). The family has not paid any other income to the nanny. EUR 100 of the payment becomes an unjust enrichment that will be recovered from the income earner on a gross basis. Kela will report the recovery to the Incomes Register once the family has informed Kela that the payment has been recovered from the income earner.

A family member must correct the amount reported with income type 321 on the actual employer’s report. The family member must also correct the amounts of employee’s earnings-related pension and unemployment insurance contributions, and the employer’s separate report. The employee’s earnings-related pension and unemployment insurance contributions can only be corrected if the correction is done during the same calendar year.

Example 18, table 1/3
New earnings payment report on recovery by Kela as the substitute payer

Action type: New report

Pay period

20 March 20xx

Start date of the pay period: 1 March 20xx

End date of the pay period: 31 March 20xx/strong>

Payer (= Kela acting as a substitute payer) details

Type of identifier: Business ID

Identifier: 11111111-1 (Kela customer identifier)

Substitute payer data group

Acts as substitute payer: Yes

Employer identifier type: Personal identity code

Employer identifier: DDMMYY-9988 (family member’s customer identifier)

Details of the income earner

Type of identifier: : Personal identity code

Identifier: ddmmyyyy-6655 (customer identifier of the income earner acting as a nanny)

Code Income type details EUR
355 Private day care allowance (wages) 100.00
 

Recovery: Yes

Earnings period: 1 February 20xx to 10 February 20xx*

 
  Additional information on recovery  
 

Recovery date: 20 March 20xx

Original pay period: 1 February to 10 February 20xx

Original payment date: 15 February 20xx*

 

* The earnings period and the original payment date are complementary additional data; however, providing them is recommended. The additional recovery data ‘Original pay period’ is mandatory. The original pay period to be reported in additional recovery details refers to the pay period during which the payment subject to recovery was originally paid to the income earner.

Example 18, table 2/3
Replacement earnings payment report submitted by a family member (actual employer)

Action type: Replacement report

Pay period

Payment date or other report date: 15 February 20xx

Start date of the pay period: 1 February 20xx

End date of the pay period: 10.02.20xx

Details of the payer (=actual employer)

Type of identifier: Personal identity code

Identifier: DDMMYY-9988 (customer identifier of the family member acting as the actual employer)

Details of the income earner

Type of identifier: Personal identity code

Identifier: ddmmyyyy-6655 (customer identifier of the income earner acting as a nanny)

Occupational class: Statistics Finland’s classification of occupations

Occupational class ID: NNNNN

Earnings-related pension insurance information: Employee’s earnings-related pension insurance contribution

Earnings-related pension provider code: NN

Pension arrangement number of employment pension institution:  NN-XXXXXXXX

Code Income type details EUR
321 Wages paid by the substitute payer for which the employer pays the employer’s social insurance contributions 200.00
413 Employee’s earnings-related pension insurance contribution (from EUR 200) 14.30
414 Employee’s unemployment insurance contribution (from EUR 200) 3.00

A family member who acts as the employer must also use the employer’s separate report to report the total amount of the employer’s health insurance contribution they have paid on the basis of the wages paid by Kela if the family member in question pays more than EUR 1,500 in wages to the same income earner in a calendar year.

In such a case, the family member corrects the amount of the employer’s health insurance contribution calculated from the wages (EUR 200) on which the health insurance contribution is based:

Example 18, table 3/3
Replacement employer’s separate report submitted by a family member (actual employer)

Action type: Replacement report

Reporting date: 15 March 20xx

Details of the payer (=actual employer)

Type of identifier: Personal identity code

Identifier: DDMMYYYY-9988 (customer identifier of the family member acting as the actual employer)

Report details

Payment month: 02

Payment month: 20xx

Code Income type details EUR
102 Employer’s health insurance contribution (total) 2.68

 

Page last updated 12/9/2022