Benefits: recovery and recourse

Example 4: The income earner has received a housing allowance of EUR 400 for the period 1 August–15 September 2021. At the same time, he has received an adjusted daily allowance. In May of the next year, it is discovered that excessive housing allowance has been paid, to the amount of EUR 128. The income earner is now employed, so no more daily allowance is paid. The overpayment has been recovered with an invoice. However, the income earner has not paid the invoice sent to them, and the invoice is now being recovered through enforcement. The employer has collected the enforcement fee from the employee's wages and paid it to the enforcement authorities. Enforcement has paid the amount to the benefit payer 2 December 2022. Although the payment was recovered by way of enforcement, the report on recovery is submitted in the same way as if the income earner had paid the payment back to the benefit payer himself. The benefit payer has reported the housing allowance to the Incomes Register, and also submitted an unjust enrichment report after noticing the overpayment.

The new report submitted for the recovery:

Example 5: The income earner has received a benefit retroactively for the period 1 February–30 April 2021 (EUR 1,000 per month). The benefit for three months was paid as a lump sum on 5 May 2021. Of this amount of EUR 3,000, EUR 2,400 (EUR 800 per month) was paid to the employer. The deduction type is "Other deduction from taxable income", so EUR 600 remains as the income earner's taxable income. It is later found out that April's portion of the benefit that was retroactively paid on 5 May was groundless, so the payer submits a report of the unjust enrichment. The payer reports the recovery data to the Incomes Register when the benefit is repaid to the payer. The actual income earner is entered as the income earner on the recovery reports regardless of who repays the money: the income earner themselves, or the substitute recipient (employer).

The example of a report (Table 1) features the report for May, in which EUR 2,400 has been paid to the substitute recipient. According to the tax card, 20% tax has been withheld from the income earner. The actual income type paid (Benefit B) is used as the income type of the deduction, because the income type (wages) paid by the substitute recipient to the income earner is not available on a benefits payment report.

The example of a report (Table 2) features the replacement report in which the EUR 1,000 benefit for April is reported as unjust enrichment. EUR 800 of this has been paid to the employer.

When the income earner or the employer pays back an unjust enrichment, the benefit payer must report the recovery data to the Incomes Register. If the share paid to the substitute recipient has not been taxable income of the income earner, the Additional repayment details data group of the recovery report cannot be used for reporting the withholding or tax at source collected from the repayment.

The example of a report (Tables 3 and 4) feature the recoveries of an unjust enrichment (Benefit B) for June. Net recovery is used for the EUR 200 repaid by the income earner on 23 June 2021, whilst gross recovery is used for the EUR 800 repaid by the employer on 18 June 2021:

The "No effect on taxation – Yes" data item must be specified for the amount paid to the employer and deducted before taxes. Because the income in question was not subject to tax, the recovery of the income must also be reported so that it has no effect on taxation. If the data item is not specified on the recovery report, the income earner will receive a deduction in their taxation to which they are not entitled.

Neither "Withholding from the repayment" or "Tax at source from the repayment" can be reported in this report.

Example 6: The income earner was paid national pension amounting to EUR 220 per month for the period 1 January–31 May 2021 (totalling EUR 1,100). However, only a pension of EUR 200 per month should have been paid (totalling EUR 1,000). A total of EUR 100 has been paid in excess pension over a period of 5 months. The income earner's withholding percentage is 5. The error is corrected in the August pension payment.

The example of a report (Table 1) features the report submitted to the Incomes Register in January, and corresponding reports are submitted for February–May:

When the benefit payer notices an error or a decision has been made regarding an unjust enrichment, the benefit payer submits the replacement reports for January–May. The example of a report (Table 2) features the replacement report for the January report, indicating the unjust enrichment:

Recovery is carried out in connection with the August payment of the national pension by offsetting the overpayment, i.e. EUR 100, from the EUR 200 pension paid. Tax is withheld from the gross amount paid, EUR 100 (200 – 100).

The example of a report (Table 3) features the report submitted in August, indicating the offsetting of the income:

Example 7: The income earner has been paid EUR 310 of housing allowance in January. In March, it is found out that no housing allowance should have been paid at all. An agreement has been made with the income earner of the housing allowance being offset in four instalments from the parental allowance of EUR 400 per month paid in the same year (withholding rate 25%). The housing allowance is tax-exempt and the parental allowance is taxable. The payer carries out the first offset in April.

The example of a report (Table 1) features the report submitted in January:

Once the error has been detected or a decision on unjust enrichment has been made, the benefits payer submits a replacement report for January. The example of a report (Table 2) features the replacement report indicating the unjust enrichment:

The first recovery is carried out in April by offsetting EUR 77.50 of housing allowance from the parental allowance (310/4). Because the parental allowance is taxable and the housing allowance tax-exempt, the withholding is calculated from the full amount of the parental allowance. The amount of withholding is thus EUR 100 (400×0.25). 

The example of a report (Table 3) features the report submitted in April, in which tax-exempt income is offset from taxable income:

Example 8: On 4 March 2021, the income earner was paid a labour market subsidy for February. A total of EUR 648 of subsidy was paid for 20 days. 20% tax has been withheld from the labour market subsidy. In May, it is found out that the labour market subsidy should have been paid for only 15 days in February (EUR 486). The gross amount to be recovered is thus EUR 162. In June, the income earner is paid EUR 480 of housing allowance, and it has been agreed that the overpayment is offset from the housing allowance. The labour market subsidy is taxable and the housing allowance is tax-exempt.

The example of a report (Table 1) features the report submitted in March:

The example of a report (Table 2) features the replacement report indicating the unjust enrichment. Because this is unjust enrichment, zero (0) is reported as the number of benefit units:

Because the later payment is tax-exempt, only the net amount paid is offset from the income earner, or EUR 129.60 (withholding EUR 32.40).

The example of a report (Table 3) features the report submitted in June, in which taxable income is offset from tax-exempt income:

Example 9: After the death of her spouse, the income earner has been paid EUR 450 per month in State artist pension as a survivors' pension. The artist pension was granted to the spouse prior to 1 January 1984, so the pension has been tax-exempt for its recipient. The income earner herself has retired, and the pension amounts have been revised. On 5 April 2021, the benefit payer has made a decision according to which only EUR 420 per month of survivors' pension should have been paid from January 2021 onwards. The recovery is carried out so that the benefit payer offsets EUR 30 in pension overpayment each month from the pensions it pays in May-August.

The example of a report (Table 1) features the report submitted in January, and corresponding reports have been submitted for February–April. It is mandatory to report the taxability of the benefit in connection with reporting the income type.

The example of a report (Table 2) features the replacement report submitted for January, in which the unjust enrichment is indicated. Corresponding reports have been submitted for February–April.

The example of a report (Table 3) features the report submitted in May, in which the offsetting of the income is indicated. Corresponding reports have been submitted for June–August.

Example 10: On 3 February 2021, the benefit payer has paid the income earner EUR 1,100 in pension for February (withholding rate 22%, i.e. EUR 242). In December 2021, it is discovered that the pension was overpaid by EUR 100 in February. In December, the benefit payer has submitted a replacement report to the Incomes Register, reporting EUR 1,000 as the amount of the February pension, and an unjust enrichment of EUR 100 (totalling EUR 1,100).

In January 2022, the income earner receives EUR 1,000 in pension, from which the withholding is EUR 200 (20%). The benefit payer and the income earner have agreed that the benefit payer will offset the EUR 100 pension overpayment in 2021, from which the withholding was EUR 22, from the payment.

The benefit payer withholds EUR 200 tax (20%) from the full EUR 1,000, because this entire amount is taxable income for the repayment year. The benefit payer deducts the net amount of the overpayment, EUR 78 (gross EUR 100, withholding EUR 22), from the remaining EUR 800 and pays EUR 722 to the income earner.

The example of a report features the report submitted in January:

Example 11: The benefit payer has paid the income earner an earnings-related allowance and a child increase to it (EUR 5.23 per day) during the period 1 March 2021–31 May 2022. In June 2022, it is discovered that there have been no grounds for payment of the child increase. The benefit payer has submitted reports on the payments to the Incomes Register. In June 2022, the benefit payer submits replacement reports in which the payer reports the child increases paid as unjust enrichment. An agreement is made with the income earner that the child increase is recovered in three instalments. The overpayment of child increase is recovered from the earnings-related allowances paid from July 2022 onwards.

The benefit payer has paid the child increase as follows:

• Year 2021: 1 March–15 December 2021 the benefit was paid for 211 days, totalling EUR 1,103.53
• Year 2022: 16 December 2021–31 May 2022 the benefit was paid for 116 days, totalling EUR 606.68.

The amount to be recovered totals EUR 1,710.21, and it is recovered as follows:

• 1st instalment: EUR 570.07 is offset from the earnings-related allowance paid on 11 July 2022 (109 days, earnings period 1 March–31 July 2021). The earlier payments were made during the period 31 March–31 July 2021.
• 2nd instalment: EUR 570.07 is offset from the earnings-related allowance paid on 12 August 2022:
• EUR 533.46 (102 days, earnings period 1 August–15 December 2021). The earlier payments were made during the period 31 August–21 December 2021.
• EUR 36.61 (7 days, earnings period 16 December–31 December 2021). The earlier payment was made on 15 January 2022.
• 3rd instalment: EUR 570.07 is offset from the earnings-related allowance paid on 11 September 2022 (109 days, earnings period 1 January–31 May 2022). The earlier payments were made during the period 14 February–5 June 2022.

20% tax has been withheld from the income earner's income during the period 1 March 2021–31 January 2022. From the beginning of February 2022, the withholding rate has been 24%.

Because the recovery is not carried out until from July 2022 onwards, the recovery can no longer be taken into account in the income earner's taxation for 2021. The payments made in 2021 are recovered in gross amounts. However, the payments made in 2022 can be recovered using net recovery (see Section 2.2.1 on net recovery and Section 2.2.2 on gross recovery).

The example of a report (Table 1) features the report of the offset submitted in July:

The benefit payer withholds 24% tax from the full amount of earnings-related allowance (2,363.76 × 0.24). EUR 570.07 of child increase is recovered from the amount remaining after the withholding, i.e. EUR 1,796.46. The income earner is paid EUR 1,226.39. The Finnish Tax Administration takes the recovered amount into account in 2022 as a recovery deduction.

Child increases paid in both 2021 and 2022 are offset from the earnings-related allowance for August. For the taxation to be correct, the recovery data must be submitted separately for each year. The 2021 child increase for the period 1 August–15 December 2021 (102 days, EUR 533.46) was paid in 2021, so it is recovered as a gross amount. This recovered payment is taken into account in the taxation for the payment year as a recovery deduction. The child increase for the period 16 December–31 December 2021 (7 days, EUR 36.61) was paid in 2022, so it is taken into account in the taxation by deducting the share from the amount of child increase for 2022.

The example of a report (Table 2) features the report of the offset submitted in August:

The benefit payer withholds tax from EUR 2,439.71 (the overpayment EUR 36.61 paid in 2022 is deducted from the EUR 2,476.32), because this amount is taxable income for the repayment year. The benefit payer deducts the offset amount, EUR 570.07 (gross EUR 533.46 + 36.61), from the remaining EUR 1,890.79 and pays EUR 1,320.72 to the income earner. The Finnish Tax Administration takes EUR 533.46 into account as a recovery deduction and deducts EUR 36.61 from the income earner's taxable income for 2022.

The example of a report (Table 3) features the report of the offset submitted in September 2022:

The recovery is carried out by offsetting the overpayment of EUR 570.07 from the earnings-related allowance, i.e. EUR 2,701.44. Withholding (24%) is done from the gross amount to be paid, i.e. EUR 2,131.37.

Example 12: On 5 July 2021, the benefit payer pays the income earner EUR 540 of labour market subsidy for the period 1 June –30 June 2021 (withholding 20%). The payer recovers EUR 25 of taxable study grant and EUR 30 of tax-exempt housing allowance paid in 2018 from the labour market subsidy.

The housing allowance and the study grant have not been reported to the Incomes Register, as they are income for the year 2018.

The example of a report features the report of the offset submitted in July:

The entire amount of the labour market subsidy, or EUR 540, is taxed as income for the year 2021. The income earner gains a recovery deduction for the year 2021 from the recovered study grant. Because the housing allowance is tax-exempt income, its recovery has no effect on taxation.

Example 13: The income earner has received an unemployment allowance of EUR 1,500 for the period 2 March–1 April 2021. The payment date is 6 April 2021. A retroactive disability pension starting from 1 March 2021 is granted to the income earner on 5 July 2021. The amount of the disability pension is EUR 800 per month, and it is paid as a lump sum for the period 1 March–31 July 2021 (totalling EUR 9,000). The unemployment allowance is recovered so that the payer of the disability pension pays EUR 1,500 of the retroactive EUR 1,800 pension for March and April to the payer of the unemployment allowance, leaving a total of EUR 7,500 (gross) to be paid to the income earner for the entire period.

The example of a report (Table 1) features the April report of the payer of the unemployment allowance:

The example of a report (Table 2) features the July report of the payer of the later benefit, i.e., the disability pension:

When the payer of the unemployment benefit has received the recourse payment, the payer submits a replacement report to the Incomes Register. The payer enters the information "Recourse – Yes” on the replacement report. When paying the basic component of the earnings-related allowance, the benefit unit must be specified. This data is also mandatory on the replacement report (Table 3):

Example 14: The income earner has received a labour market subsidy of EUR 500.01 (gross) per month for the period 1 April2021–1 March 2022. On 4 April 2022, the income earner is granted a retroactive disability pension of EUR 450 per month (gross) for the same period. The benefits are paid simultaneously to the income earner, so the earlier paid labour market subsidy creates an overpayment of EUR 50.01. However, this overpayment is not recovered from the income earner.

The example of a report (Table 1) features the May report submitted by the payer of the labour market subsidy. The payer submits a similar report for each month, specifying the labour market subsidy paid.

The payer of the disability pension submits a report to the Incomes Register of the retroactive disability pension paid on 4 April 2022 for the period 1 April 2021–31 March 2022 (Table 2). The payer also reports the disability pension for April 2022 it paid on the same day. The amounts paid as recourse are shown in the Deductions data group. Although the disability pension is paid as a continuous income, "One-off remuneration – Yes" must be specified, as income is paid retroactively for a period of more than three months before the beginning of the tax year.

When the payer of the labour market subsidy receives a recourse payment from the payer of the disability pension, the payer of the labour market subsidy submits a replacement report for May 2021 to the Incomes Register (Table 3). The recourse payment of EUR 450 received and the overpayment of EUR 50.01 that has changed into unjust enrichment are reported on the replacement report. The payer also submits a corresponding replacement report for the other months. Because unjust enrichment is in question, zero (0) is reported as the benefit unit. The data must not be removed from the replacement report, as it is required by the data users.

Example 15: The income earner was paid EUR 1,500 of sickness daily allowance for the period 1 April–30 April 2021. In August 2021, the same benefit payer grants the income earner a retroactive disability pension of EUR 1,800 per month from 1 April 2021 onwards. The disability pension is paid instead of the sickness allowance. The benefit payer collects the sickness allowance it previously paid for the same period from the disability pension (internal recourse).

Because the earlier payment and the later payment are both taxable, section 112 a, subsection 3 of the act on income tax is applied. The payment made later (the disability pension) is therefore not taxable income to the extent it is paid to the payer of the earlier benefit (sickness allowance). The earlier payment remains taxable income.

The benefit payer deducts the gross amount of the earlier payment (amount from which tax has not been withheld) from the gross amount of the payment made to the income earner later. EUR 1,500 of sickness allowance recourse is thus deducted from the retroactive EUR 1,800 pension. In August, the benefit payer also pays the disability pension for April-August.

The example of a report (Table 1) features the benefit payer's May report of the sickness allowance:

The benefit payer pays the disability pension retroactively for the period 1 April–31 August 2021. A new report must be submitted to the Incomes Register for this payment (Table 2). The recourse deductions are reported in the Deductions data group.

When the benefit payer receives the recourse payment, the payer submits a replacement report and specifies "Recourse – Yes" (Table 3).

Example 16: The income earner became unemployed on 1 December 2020. The benefit payer has paid EUR 2,228 of social assistance to the income earner during the period 1 January 2021–15 March 2021 against the upcoming earnings-related allowance. On 23 March 2021, the unemployment fund pays the income earner a total of EUR 4,800 of earnings-related allowances for the period 5 December 2020–15 March 2021, of which amount it pays EUR 2,228 to the earlier benefit payer.

The social assistance is not reported to the Incomes Register.

In March 2021, the unemployment fund submits a report to the Incomes Register:

Example 17: In July 2021, the income earner is paid a tax-exempt benefit retroactively for the period 1 April–30 April 2021. A taxable benefit was previously paid for the same period. The payer of the taxable benefit has made a recourse claim of EUR 200. EUR 600 of tax-exempt benefit is paid. EUR 200 of this amount is paid as a recourse to the payer of the earlier benefit, and EUR 400 to the income earner. The example of a report (Table 1) features the report submitted by the payer of the tax-exempt benefit, taking the recourse claim into account: 

In order for the Finnish Tax Administration to receive information on the taxable benefit having been recovered as a recourse on the tax-exempt income, the payer of the taxable benefit must include the "Recourse from tax-exempt income, payment date" entry in addition to the "Recourse – Yes" entry. Based on this data, the income earner is correctly taxed, and only the part of the taxable benefit that was not recovered as a recourse on tax-exempt income becomes taxable income.

The "Recourse from tax-exempt income, payment date" entry does not have to be reported on the replacement report if the recipient of the recourse payment has not received the information in question from the payer of the recourse payment. Information not available to the report submitter cannot be reported to the Incomes Register.

The example of a report (Table 2) features the replacement report submitted by the payer of the earlier benefit after the payer has received the recourse payment. The recourse payment was made to the payer of the earlier benefit on 1 July 2021. The payment shows on the recipient's account on 3 July 2021 and is allocated in the recipient's system on 5 July 2021:

Example 18: On 10 April 2020, the income earner has been paid EUR 1,200 of taxable benefit for the period 2 March–1 April 2021. EUR 300 has been withheld from the benefit. Later, a taxable pension of EUR 500 and a related tax-exempt supplement of EUR 30 are granted for the same period. The payer of the taxable benefit paid earlier has made a recourse claim of EUR 530.

The example of a report (Table 1) features the report submitted by the payer of the benefit paid later:

The payer of the benefit paid earlier submits a replacement report, in which the payer includes the "Recourse – Yes" entry. Additionally, the payer reports the "Recourse – Yes" entry for the payment received from the tax-exempt income as well as the "Recourse from tax-exempt income, payment date" entry. Because the benefit payer has received recourse payments for both taxable and tax-exempt income, the recourse payments must be itemised as follows (Table 2):

Example 19: Vehicles A and B collide. The driver of vehicle A is injured. The liability is split evenly between the insurance companies of the vehicles (A and B).

The insurance company of vehicle A grants and pays full compensation for the personal injuries sustained by the driver of vehicle A.

Because the liability is split evenly, the insurance company (A) will recourse half of the compensation it has paid from the insurance company of vehicle B (B). Such a recourse payment transaction between the companies, where the income earner is not a concerned party in the decision, is not reported to the Incomes Register.

Only the reports on the compensation paid submitted by the insurance company (A) are visible in the Incomes Register.

Example 20:  A traffic accident occurs during a commute. A cyclist on the way to/from work is hit by a car and injured. The damages will be covered on the basis of the statutory accident insurance.

The accident insurance company pays and reports the payments to the Incomes Register before the motor insurance company has made a decision regarding compensation to the income earner. The motor insurance company pays the difference in accordance with the benefits of the motor liability insurance act (liikennevakuutuslaki 460/2016) and the accident insurance act (tapaturmavakuutuslaki 608/1948) to the injured party. The accident insurance company will recourse the compensation paid from the motor insurance company. The motor insurance company’s recourse payment to the accident insurance company in no way affects the amount or nature of the benefits paid to the income earner.

When the motor insurer grants a compensation for the difference and makes a decision regarding it to the income earner, the recourse transactions do not show in the Incomes Register. The payments reported by the accident insurance company regarding the whole benefit as well the payments made by the motor insurer for the difference will show in the Incomes Register. On the other hand, payments made by the motor insurer to the accident insurance company on the basis of the right of recourse procedure will not show in the Incomes Register, because the income earner is not a concerned party in them.

From the point of view of the income earner, the income received by the income earner comprises both the accident insurance compensation and the motor insurance compensation.

Example 21: On 1 September 2021, a person has to be absent from work due to illness, and they receive a sickness allowance from benefit payer A from that day onwards. The payment of the sickness allowance is stopped on 31 December 2021. The person becomes unemployed and starts to receive an unemployment allowance paid by benefit payer B from 1 January 2022 onwards. Furthermore, due to a difficult financial situation, the person receives social assistance from A (section 23 of the Act on Social Assistance) for the period 1 September 2021–15 February 2022. 

On 19 February 2022, the person is paid a disability pension from 1 September 2021 onwards. However, the pension is subject to recourse claims from benefit payer A (sickness allowance and social assistance) as well as benefit payer B (unemployment allowance). Due to the recourse claims, benefit payer C does not pay the pension for the retroactive period, but starts to pay the continuous pension from 1 March 2022 onwards. For this continuous payment, benefit payer C submits a normal new benefits payment report to the Incomes Register with 1 March 2022 as the payment date.

Later, on 8 March 2022, benefit payer C pays the retrospective disability pension in compliance with the recourse claims received from A and B.

The amount of the person's disability pension is EUR 1,000 a month (index increase not taken into account). The pension for the retroactive period from 1 September 2021 to 28 February 2022 thus totals EUR 6,000. The person has not provided a valid tax card for the retroactive period, so C withholds 50% of the taxable part of the retroactive benefit.

Benefit payer C takes into account the following recourse information:

The pension payment for the period of 1 September 2021–30 September 2021

• The total pension income is EUR 1,000.
• A claims a total of EUR 900 in sickness allowance for the period of 1 September 2021–30 September 2021.
• The part exceeding the sickness allowance claim, EUR 100, can be paid as compensation for the social assistance paid by A for the same period, i.e. from 1 September 2021 to 30 September 2021. A total of EUR 50 is paid as social assistance compensation after withholding tax.

The pension payment for the period of 1 October 2021–31 October 2021

• The total pension income is EUR 1,000.
• A claims a total of EUR 900 in sickness allowance for the period of 1 October 2021–31 October 2021.
• The part exceeding the sickness allowance claim, EUR 100, can be paid as compensation for the social assistance paid by A for the same period, i.e. from 1 October 2021 to 31 October 2021. A total of EUR 50 is paid as social assistance compensation after withholding tax.

The pension payment for the period of 1 November 2021–30 November 2021

• The total pension income is EUR 1,000.
• A claims a total of EUR 900 in sickness allowance for the period of 1 November 2021–30 November 2021.
• The part exceeding the sickness allowance claim, EUR 100, can be paid as compensation for the social assistance paid by A for the same period, i.e. from 1 November 2021 to 30 November 2021. A total of EUR 50 is paid as social assistance compensation after withholding tax.

The pension payment for the period of 1 December 2021–31 December 2021

• The total pension income is EUR 1,000.
• A claims a total of EUR 900 in sickness allowance for the period of 1 December 2021–31 December 2021.
• The part exceeding the sickness allowance claim, EUR 100, can be paid as compensation for the social assistance paid by A for the same period, i.e. from 1 December 2021 to 31 December 2021. A total of EUR 50 is paid as social assistance compensation after withholding tax.

The pension payment for the period of 1 January 2022–31 January 2022

• The total pension income is EUR 1,000.
• B claims a total of EUR 800 in unemployment allowance for the period from 1 January 2022 to 31 January 2022.
• The part exceeding the unemployment allowance claim, EUR 200, can be paid as compensation for the social assistance paid by A for the same period, i.e. from 1 January 2022 to 31 January 2022. A total of EUR 100 is paid as social assistance compensation after withholding tax.

The pension payment for the period of 1 February 2022–28 February 2022

• The total pension income is EUR 1,000.
• B claims a total of EUR 800 in unemployment allowance for the period from 1 February 2022 to 28 February 2022.
• The part exceeding the unemployment allowance claim, EUR 200, can be paid as compensation for the social assistance paid by A for the same period, i.e. from 1 February 2022 to 15 February 2022. A total of EUR 100 is paid as social assistance compensation after withholding tax.

Benefit payer C submits the following report on its retroactive payment (Table 1):

No part of benefit payer C’s payment remains to be paid to the income earner. After the recourse of the taxable sickness allowance and unemployment allowance, EUR 800 remains in the name of the income earner, of which half has been withheld and half recovered as social assistance paid in excess.

Example 21: (continued) B’s replacement report for February (Table 2):

Example 22: Benefit payer A has granted an income earner a benefit of EUR 100 for the period of 1 March 2021–31 March 2021. The benefit becomes available to the income earner on 10 March 2021 and is reported to the Incomes Register. Later, benefit payer B also grants the same income earner benefit B of EUR 100 for the same earnings period, paid on 1 June 2021. In reality, nothing is paid to the income earner’s account in June because the entire payment is made to benefit payer A on the basis of the recourse claim. Time passes, and benefit payer C also grants the same income earner benefit C of EUR 100 for the same earnings period, paid on 1 February 2022. In this case, too, nothing is paid to the income earner’s account in reality because the payment is made to benefit payer B on the basis of their recourse claim.

Benefit payer A’s report (Table 1):

Benefit payer B’s report including the recourse deductions (Table 2) and benefit payer A’s replacement report on the received recourse payment (Table 3):

Benefit payer C’s report including the recourse deductions (Table 4) and benefit payer B’s replacement report on the received recourse payment (Table 5):

Example 23. The income earner has been paid EUR 1,100 per month of partial early old-age pension for the period 1 January –31 October 2021. The payer has made a retroactive decision on a disability pension on 15 October 2021. The same amount of disability pension has been paid as of 1 June 2021 as the partial early old-age pension, i.e. EUR 1,100 per month. The payer has taken the previously paid partial early old-age pension into account as a partial payment for the disability pension. The payer has reported the change in the pension type on a replacement report and specified the "Income type changed, new income type code" entry on the reports submitted from 1 June 2021 onwards.

The example of a report (Table 1) features the January 2021 report of the partial early old-age pension. Corresponding reports have been submitted until 31 May 2021.

The next example of a report (Table 2) features the replacement report submitted by the benefit payer for June, reporting the change of the partial early old-age pension into a disability pension. The payer also submits corresponding reports for the other months for which the partial early old-age pension has been considered to be a partial payment of the disability pension.

However, in August 2022, the payer has realised that the income earner has been paid a partial early old-age pension and disability pension on incorrect grounds in 2021. EUR 1,050 per month of pension should have been paid instead of EUR 1,100. The payer has made a recovery decision on 30 August 2022. It has been agreed with the income earner that the EUR 600 overpayment (EUR 50 per month for a period of 12 months) is recovered with an invoice in October.

The payer has submitted an unjust enrichment report after noticing the overpayment. The example of a report (Table 3) features the new replacement report for June, and corresponding replacement reports have also been submitted for the other months.

The payer also submits corresponding reports for January–May 2021, i.e., for the period in which the partial early old-age pension was paid. The "Income type changed, new income type code" entry is not specified on these reports.

The payer recovers the overpayment from the income earner in October 2022. The example of a report (Table 4) features the payer's recovery report (the share of the partial early old-age pension for 1 January–31 May 2021 totals EUR 250 and the share of the disability pension for 1 June–31 December 2021 totals EUR 350):