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Annual income

The amount of certain Kela benefits is based on your annual income. The following daily allowances are paid on the basis of annual income:

  • sickness allowance
  • daily allowances for parents (pregnancy allowance, special pregnancy allowance and parental allowance)
  • rehabilitation allowance
  • special care allowance.  

Daily allowances paid on the basis of annual income are paid for 6 days a week, i.e. Monday to Saturday, with the exception of midweek holidays. A midweek holiday is a holiday that falls on some other day than a Sunday.

For what period is annual income calculated?

Annual income is calculated for a reference period consisting of the previous 12 calendar months. However, the calendar month directly preceding the start of the allowance is not included in the reference period, and the income during this month is not included in the annual income..

A doctor determines that Matti is incapable of work starting from 14 April 2024. Matti applies for sickness allowance from Kela. The month preceding the start of the daily allowance, in this case March 2024, is not included in the annual income reference period. The reference period is thus 1 March 2023 to 28 February 2024.

Maija applies for pregnancy allowance on 15 July 2024 for the period 27 October 2024 to 14 December 2024. The month preceding the start of her pregnancy leave, in this case September 2024, is not included in the annual income reference period. The reference period is thus 1 September 2023 to 31 August 2024. The decision can be issued at the beginning of September, at the earliest.

In certain situations, the daily allowance can be calculated on the basis of the last 3 months of the reference period. This is possible for example when you have been on child care leave or have graduated from your studies. You must separately request in your application that your allowance should be calculated based on your income for 3 months.

What income is included in annual income?

The following forms of income are included in annual income:

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

Annual income may consist of one or more types of income you have received during the reference period.

As a rule, Kela receives the information needed to calculate annual income from the national Incomes Register, the pension and insurance providers and the unemployment funds. You need not report your income separately to Kela.

Employers can also report to the Incomes Register various bonuses, compensations and other forms of income which are not included in annual income. If necessary, Kela may request further information from you or from the payer of the income.

A deduction will be made from the wages and salaries or salary for insurance purposes included in the annual earned income. This is called an insurance contribution deduction and it amounts to 8.95 per cent in 2024. There is no corresponding deduction from earnings under the YEL and MYEL schemes.

The insurance contribution deduction means that a sum is deducted from the annual income. The sum is the equivalent of the combined total of the health insurance contributions towards daily allowances, the contributions levied from employees towards earnings-related pensions and the unemployment insurance contributions payable by employees.

Income earned abroad can be included in annual income even if you have not been covered by health insurance in Finland. Income earned abroad is included if all the following conditions are met:

  • You have moved back to Finland.
  • During the 12 month reference period (linkki), you have been paid a wage or salary for work in another EU Member State or in a country that applies the EU legislation (e.g. Norway).
  • After your return to Finland, you are again covered under the Finnish national health insurance system.
  • You have no annual income from Finland.

If the salary you earned abroad is significantly lower or higher than the salary you would have received for a similar job in Finland, your daily allowance will be based on an estimate made by Kela. It is an estimate of the income that you would have received for similar work in Finland, considering your education and qualifications. 

Minimum daily allowance

You can receive daily allowance even if you have no income at all or if your income is low. If the daily allowance calculated on the basis of your annual income is less than the minimum daily allowance, you will receive the minimum daily allowance.

In 2024, the minimum daily allowance is
31,99 euros per weekday (Mon-Sat)

Daily allowances calculated on the basis of annual income, with examples

Use the sickness allowance calculator (available in Finnish or Swedish) to estimate the amount of sickness allowance you can get. If you want to calculate the amount of daily allowance yourself, use the calculation formula.

Example of sickness allowance for employees

A doctor determines that Matti is incapable of work starting from 14 April 2024. Matti applies for sickness allowance from Kela. The reference period for the annual income is 1 March 2023 to 28 February 2024. During this period, Matti received a salary of 2,500 euros per month (before taxes) and 1,125 euros in holiday bonus (before taxes).

Calculation of his annual income: 12 months x 2,500 euros + 1,125 euros = 31,125 euros. The insurance contribution deduction is then made from this amount.

Using the calculation formula, Matti’s sickness allowance is approximately 65 euros per weekday.

Example of sickness allowance for entrepreneurs

A doctor determines that Liisa is incapable of work starting from 15 February 2024. Liisa applies for sickness allowance from Kela. The reference period for annual income is 1 January to 31 December 2023. Liisa’s YEL income is 20,000 euros per year. The annual income is calculated on the YEL income, but income such as wage income paid from her company is not included.

Using the calculation formula, Liisa’s sickness allowance is approximately 46 euros per weekday (Mon–Sat).

Example of sickness allowance for unemployed persons

A doctor determines that Pekka is incapable of work starting from 14 February 2024. Pekka applies for sickness allowance from Kela. The reference period for annual income is 1 January to 31 December 2023. During this period, Pekka has received earnings-related daily allowance 5 days a week at 60.00 euros per day.

Based on the average earnings-related daily allowance, Pekka’s sickness allowance is approximately 52 euros per weekday (Mon–Sat).

Use the rehabilitation allowance calculator (available in Finnish or Swedish) to estimate the amount of rehabilitation allowance you can get. If you want to calculate the amount of daily allowance yourself, use the calculation formula.

Example of rehabilitation allowance for employees

Maija’s entitlement to rehabilitation allowance starts on 14 April 2024. The reference period for the annual income is 1 March 2023 to 29 February 2024. During this period, Maija received a salary of 2,500 euros per month (before taxes) and 1,125 euros in holiday bonus (before taxes).

Calculation of her annual income: 12 months x 2,500 euros + 1125 euros = 31,125 euros.* The insurance contribution deduction is then made from this amount.

Using the calculation formula, Maija’s rehabilitation allowance is approximately 65 euros per weekday.

Example of rehabilitation allowance for entrepreneurs

Liisa’s entitlement to rehabilitation allowance starts on 15 February 2024. The reference period for annual income is 1 January to 31 December 2023. Her YEL income is 20,000 euros per year. The annual income is calculated on the YEL income, but income such as wage income paid from her company is not included.

Using the calculation formula, Liisa’s rehabilitation allowance is approximately 46 euros per weekday.

Use the calculator to estimate the amount of daily allowances for parents that you could get. If you want to calculate the amount of daily allowance yourself, use the calculation formula.

Kela cannot issue a decision on daily allowances for parents until the reference period for the annual income has ended.

Example of applying for pregnancy allowance

Maija applies for pregnancy allowance on 15 July 2024 for the period 27 October 2024 to 14 December 2024. The reference period for the annual income is 1 September 2023 to 31 August 2024. The decision can be issued at the beginning of September, at the earliest.

Use the calculator to estimate the amount of special care allowance that you can get. If you want to calculate the amount of daily allowance yourself, use the calculation formula.

Example of special care allowance for employees

Maija’s entitlement to special care allowance starts on 14 April 2024. The reference period for the annual income is 1 March 2023 to 29 February 2024. During this period, Maija received a salary of 2,500 euros per month (before taxes) and 1,125 euros in holiday bonus (before taxes).

Calculation of her annual income: 12 months x 2,500 euros + 1125 euros = 31,125 euros. The insurance contribution deduction is then made from this amount.

Using the calculation formula,  Maija’s special care allowance is approximately 65 euros per weekday.

Example of special care allowance for entrepreneurs

Liisa’s entitlement to special care allowance starts on 15 February 2024. The reference period for annual income is 1 January to 31 December 2023. Her YEL income is 20,000 euros per year. The annual income is calculated on the YEL income, but income such as wage income paid from her company is not included.

Using the calculation formula, Liisa’s special care allowance is approximately 46 euros per weekday.

Example of special care allowance for unemployed persons

Pekka’s entitlement to special care allowance starts on 14 February 2024. The reference period is 1 January to 31 December 2023. During this period, Pekka has received earnings-related daily allowance 5 days a week at 60.00 euros per day (Mon–Fri).

Based on the average earnings-related daily allowance, Pekka’s special care allowance is approximately 52 euros per weekday (Mon–Sat).

Income taken into account in the calculation of annual income

Earnings from private- or public-sector employment paid during the reference period are included in the annual income. However, the entire earnings are not included in the annual income, but an insurance contribution deduction is made first.

Kela usually receives information on wages and salaries from the national Incomes Register, so you need not report this information to Kela separately. Please note that employers also report income that is not included in the annual income, e.g. reimbursements of costs, to the Incomes Register. Kela does not include these in the annual income.

If you think that your earnings data in the Incomes Register contain inaccuracies or incorrect information, you should ask your employer to correct the information. You cannot correct the data in the Incomes Register yourself.

If you have been working abroad as a posted worker during the reference period and a salary for insurance purposes has been determined for this period of employment, this will be taken into account in your annual income instead of the salary actually paid. However, the salary for insurance purposes is not included in the annual income in its entirety, as an insurance contribution deduction is made first.

If you are an entrepreneur insured under the self-employed persons' (YEL) or farmers' (MYEL) pension insurance schemes, your annual income will include your reported income under either of those schemes but only for the time your pension insurance has been in force during the reference period.

If the YEL or MYEL insurance has not been in force during the reference period, no income from self-employment is included in the annual income. This also applies to so-called light entrepreneurs.

Other types of income from self-employment is not taken into account in the annual income, for instance wage income from your own business or earnings from self-employment.

You are a part-time entrepreneur if you have worked as an entrepreneur during the reference period at the same time as you have been employed by another employer.

In this situation, your annual income includes your wage or salary income and your income under the YEL and MYEL schemes from the period when the insurance has been in force. However, your wage or salary income is not included in the annual income in its entirety, as an insurance contribution deduction is made first.

If you have a research or arts grant or scholarship and you have a MYEL insurance with the Farmers' Social Insurance Institution (Mela) based on the grant or scholarship, your annual income is calculated on the basis of your reported income under the MYEL insurance.

If you are not required to take out MYEL insurance on the basis of the grant or scholarship, the grant or scholarship is not taken into account in the annual income.

The amount of your annual income can also be based on certain benefits that you have received during the 12-month reference period.

This is called benefit-based income, and it is always calculated on the basis of an average (so-called calculated income). It is thus not the same as the total amount of the benefits that you have been granted during the reference period. Instead, it is calculated on the basis of the daily average of the benefits you have received during the reference period.

There is always a difference between the benefit-based income and the total amount of the benefits you receive. In some cases, the difference can be considerable. We use benefit-based income to ensure that your income does not decrease even if the benefit you receive changes.

Only the following benefits are taken into account if they have been granted for the reference period for annual income:

  • unemployment benefits
  • job alternation compensation
  • sickness allowance
  • daily allowance under the YEL Act or sickness allowance paid by the Farmers’ Social Insurance Institution (Mela)
  • partial sickness allowance
  • daily allowances for parents
  • special care allowance
  • sickness allowance on account of human cell, tissue or organ donation
  • rehabilitation allowance from Kela
  • rehabilitation allowance or rehabilitation increment under the Earnings-related Pensions Acts
  • disability pension paid under the Earnings-related Pensions Acts
  • disability pension paid under the National Pensions Act
  • guarantee pension as a supplement to disability pension
  • adult education allowance
  • 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 received wages for the same period. Your wages are included in your annual income, so the same amount cannot be included in your annual income a second time as benefits.

Benefits may also be received retroactively, in which case they will be included retroactively in the annual income for the reference period. In this case, contact Kela so that the amount of your daily allowance can be recalculated.

Compensation paid for loss of income during the reference period is included in your annual income if the compensation is for

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

Compensation is usually not included in annual income if you receive some other benefit from Kela at the same time.

Compensation paid to the employer is not included in your annual income because you have received wages for the same period Your wages are included in your annual income, so the same amount cannot be included in your annual income a second time as compensation for loss of income.

Last modified 3/12/2024