Who is self-employed?
A self-employed person is gainfully employed without being in an employment relationship. A significant difference between self-employed persons and employees is that self-employed persons must arrange pension insurance for themselves by taking out and paying contributions towards pension insurance for self-employed persons.
Self-employed persons take out pension insurance under the Self-Employed Persons’ Pensions Act (YEL). Farmers take out insurance under the Farmers’ Pensions Act (MYEL). Farmers include farmers, fishermen, reindeer herders and forest owners. Grant recipients may also be liable to arrange insurance under MYEL.
Pension insurance is arranged with an authorised pension provider.
- When do I need insurance? (työeläke.fi)
- Agricultural entrepreneurs (mela.fi)
- Grant recipients (mela.fi)
- Find your pension provider (työeläke.fi)
Part-time self-employed person or light entrepreneur
If the income from self-employment is high enough, the liability to arrange pension insurance also concerns
- part-time self-employed persons
- light entrepreneurs who work via an invoicing service
- freelancers, i.e. self-employed persons who work for different clients.
Pension insurance affects social security
In addition to the earnings-related pension, pension insurance under the YEL or MYEL pension insurance schemes also affects benefits provided by Kela, for instance
- maternity, special maternity, paternity and parental allowance
- sickness allowance
- rehabilitation allowance.
The amount of the allowance is based on the annual income, which for self-employed persons is the reported income under the YEL or MYEL pension insurance schemes.
In order for self-employed persons to be eligible for unemployment allowance from an unemployment fund or from Kela, they must meet the work requirement for self-employed persons. Meeting the work requirement means that the self-employed person has worked long enough and that the reported income under the YEL or MYEL pension insurance schemes is sufficiently high. Read more about the work requirement for self-employed persons.
The earnings-related unemployment allowance paid by the unemployment fund is based on the reported income under the YEL or MYEL pension insurance schemes.