When working as an entrepreneur, the social security changes – but it doesn’t end. If you work with a business name or if you earn more than EUR 8,063.57 (in 2021), you’re obliged to take out YEL insurance. It is mandatory as it is a large part of the pension and social security of an entrepreneur.
The unemployment benefit, just as the sickness allowance amount, is calculated based on your YEL income. That’s why it is important to determine correctly from the start. Every YEL insurance contribution you pay increases your pension and improves the social security of the entrepreneur. The YEL insurance contribution is deductible.
The YEL insurance contribution is determined based on your estimated income. An entrepreneur must take out YEL insurance if they are between the ages of 18 and 67, live in Finland, work like an entrepreneur – i.e. a light entrepreneur or an entrepreneur – and the operation has lasted for longer than four (4) months and the income is more than EUR 8,063.57 per year (in 2021).
In case the entrepreneur has taken out an YEL insurance based on the income, the unemployment benefit, sickness allowance and other benefits aren’t any worse than those of a regular employee.
More information on the YEL insurance can be found on the website of Varma.
TEST: MUST I TAKE OUT YEL INSURANCE?
Does your work as a light entrepreneur last longer than four (4) months?
- If the answer is yes, you should take out YEL insurance.
- If the answer is no, you’re not required to take out YEL insurance.
Is your income more than EUR 8,063.57, within twelve (12) months?
- If the answer is yes, you should take out YEL insurance.
- If the answer is no, you’re not required to take out YEL insurance.
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