Amount determined on new grounds as of 1 January 2020

If your right to an allowance for parents starts on 1 January 2020 or later, the allowance for parents is determined on the basis of an annual income. You can estimate the amount of parental allowances that start in 2020 by using the calculator.

The annual income is calculated for a reference period of 12 calendar months prior to the calendar month that precedes the start of the entitlement to allowance for parents. 

Example

If Maija’s entitlement to maternity allowance starts on 25 May 2020, the annual income is calculated for the period of 12 months prior to April, i.e. 1 April 2019–31 March 2020.

There is a gap of 1 month between the reference period and the start of the allowance period, and the income during this time is not taken into account. During the transition period in January 2020, the reference period for the annual income is exceptionally the period of 12 calendar months immediately preceding the start of the allowance for parents, i.e. 1 January–31 December 2019.

The following are taken into account in the annual income:

  • wages and salaries
  • salary for insurance purposes
  • income under the self-employed persons' (YEL) and farmers' (MYEL) pension insurance schemes
  • certain benefits
  • certain compensations for loss of income.

The annual income can consist of one or several of the aforementioned types of income. Kela usually receives the necessary information from the national incomes register and the insurance providers, so this information need not be reported to Kela separately.

If you have no income during the reference period or the income is very small, the amount of the allowance equals at least the minimum amount.

The allowance for parents can also be determined on the basis of the income that was the basis for a previous allowance for parents if the expected due date of the new child occurs before the previous child reaches the age of 3 years. Read more

Allowances for parents that are paid for the same child are also henceforth determined on the basis of the same income. The income is thus not reviewed when you switch from one type of allowance for parents to another, for instance from maternity or paternity allowance to parental allowance. Read more

Wage/salary

The annual income includes wages and salaries that have been paid during the reference period. Kela usually receives information on wages and salaries from the national incomes register, so this information need not be reported to Kela separately.  

Example

Maija’s entitlement to maternity allowance starts 14 April 2020. The reference period is 1 March 2019–29.2.2020. During this period, Maija has received EUR 2,500 per month in wages (before taxes) and EUR 1,125 in holiday bonus (before taxes).

The annual income includes 12 months x EUR 2,500 + EUR 1,125 = EUR 31,125.*

The amount of the allowance for parents is approximately EUR 65 per working day.

*) Insurance contributions are deducted from the annual income. In 2020 the deduction is 9.58 %.

Salary for insurance purposes

If you have been working abroad during the reference period and a salary for insurance purposes has been determined for this period of employment, the salary for insurance purposes will be taken into account in the annual income instead of the salary actually paid. 

Income under the self-employed persons' (YEL) and farmers' (MYEL) pension insurance schemes

The annual income for self-employed persons includes the confirmed income under the Self-Employed Persons’ Pensions Act (YEL) or the Farmers’ Pensions Act (MYEL) for the 12-month reference period. The annual income does not include wage income from one’s own company or income from self-employment.

If the confirmed income under the Self-Employed Persons’ Pensions Act (YEL) or the Farmers’ Pensions Act (MYEL) has changed during the reference period, the average confirmed income is used.

Example

Liisa’s entitlement to maternity allowance starts 15 February 2020. The reference period is 1 January–31 December 2019. The YEL income is EUR 20,000 per year.

The annual income includes the YEL income. 

The amount of the allowance for parents is approximately EUR 46 per working day.*

*) Estimate

Benefit-based income

Your annual income can also be calculated on the basis of certain benefits you may receive.

This is referred to as benefit-based income and is calculated on the basis of the average daily amount of certain benefits you have received in the 12-month reference period.

The benefit-based income only includes the following benefits when the period of award falls within the 12-month reference period:

  • unemployment benefit
  • job alternation compensation
  • sickness allowance
  • daily allowance in accordance with the self-employed persons’ pension (YEL) scheme or sickness allowance paid by the Farmers’ Social Insurance Institution (Mela)
  • partial sickness allowance
  • maternity, paternity and parental allowances
  • special care allowances
  • sickness allowance on account of human cell, tissue and organ donation
  • rehabilitation allowance from Kela
  • rehabilitation allowance or rehabilitation increase provided under the earnings-related pension acts
  • disability pension provided under the earnings-related pension acts
  • disability pension provided under the National Pensions Act
  • guarantee pension as supplement to disability pension
  • adult education subsidy
  • adjustment pension or adjustment allowance for Members of Parliament
  • study grant.

Benefits paid to the employer are not included in the annual income because you have for the same period received wages that are included in the annual income.

Example

Pekka’s entitlement to paternity allowance starts 14 February 2020. The reference period is 1 January–31 December 2019. Pekka has received EUR 60.00 per day for 5 days per week in earnings-related unemployment allowance during this period.

Based on the average earnings-related allowance, the paternity allowance is approximately EUR 52 per day*. Paternity allowance is paid for 6 days a week.

*) Estimate

Compensations for loss of income

Compensations for loss of income awarded during the reference period are included in the annual income if the compensation is based on one of the following:

  • accident at work
  • occupational disease
  • traffic accident
  • patient injury
  • military injury
  • communicable disease under the Act on Communicable Diseases (sickness allowance on account of an infectious disease).

Compensations for loss of income are taken into account to the amount awarded.

The compensation is usually not included in the annual income if payment continues alongside a Kela benefit awarded for the same period. Compensations paid to the employer are not included in the annual income because you have for the same period received wages that are included in the annual income.

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