24.40%

YEL of work income

19.03%

new entrepreneur, 48 months

€9,423.09

work-income floor

€15,481

unemployment threshold

What changed in 2026

Up to and including 2025 the YEL contribution depended on age: those under 53 and those aged 63 or over paid 24.10%, while the 53–62 bracket paid 25.60%. From 2026 the brackets are gone entirely and everyone pays the same 24.40%. The same unification was applied to the TyEL employee contribution.

For the 53–62 group this is a cut; for everyone else a small rise. If a guide still quotes two different percentages, it is describing 2025 – this is the single most common out-of-date YEL figure online right now.

Who has to take out YEL

Owning a company is not enough on its own: you must also work in it. The insurance is taken out with a pension company of your choice within six months of the start of the activity.

For a limited company the test has two parts, and both must be met. The shareholder must work in a leadership position, and must own either more than 30% alone or more than 50% together with family members, counted in shares or in voting rights. A shareholder below those limits is insured as an employee under TyEL instead.

The obligation begins once the activity has run continuously for more than four months after the age of 18 and the estimated work income exceeds the floor of €9,423.09. The upper age limit is 69, and 70 for those born in 1962 or later. Using an invoicing service does not by itself settle your status – what settles it is how the work is actually done. The cost of getting started is covered in more detail alongside the start-up grant.

What YEL costs in 2026

Figures are rounded to whole euros. The new-entrepreneur discount is 22% of the contribution and runs for 48 months in total. The months are not lost if the self-employment breaks off: the discount may be split across at most two separate periods, so unused months remain available later.

Work income is neither salary nor turnover

YEL work income is an estimate of the monetary value of your own work input: the salary you would have to pay an outsider to do the same job to the same standard. It is not the profit of the business, not the turnover, and not the sum you withdraw for yourself. This is the single most misunderstood point in the whole YEL system.

Eläketurvakeskus provides a calculation service for estimating it: it combines the median wage in your industry with the turnover of the business and produces a recommendation. The recommendation carries roughly 30% of leeway in either direction so that individual differences can be taken into account. Even so it is not binding: if your work input differs from what is typical for the industry, you may depart from the range with good reason. The final figure is confirmed by the pension company.

The three-year review – and what silence means

Since the 2023 reform the pension company must review your work income every three years if you have not changed it yourself. In practice the company sends a proposal, and you have two weeks to respond. A new figure takes effect from the beginning of the second month after the notification.

Silence does not work as a veto. If the entrepreneur does not respond, the pension company decides on the basis of the information available to it and may raise the figure up to the ceiling. There is a ceiling, though: a single review may raise work income by at most €4,000, and the first two reviews combined by at most €8,000.

A law change that entered into force at the start of 2026 extended the €4,000 cap to entrepreneurs who started in 2023–2025, for reviews carried out in 2026–2028. Previously the first review for that group was not capped at all.

What work income decides

Pension accrues at 1.5% of work income per year. At the floor that is roughly €141 a year: thirty years of self-employment would build an annual pension of under €4,300. The projected future accrual used for a disability pension is calculated from the same work income, so a low figure permanently shrinks that too.

Kela calculates an entrepreneur benefits from the confirmed YEL work income, not from actual profit. The basis is the work income over the 12 months of insurance preceding the calendar month before the benefit starts. In practice that means an increase only shows up in full about a year later.

One advantage does run the other way, and it is a real one. For a YEL-insured entrepreneur the waiting period for sickness allowance is only the day of falling ill, whereas for everyone else it is the day of falling ill plus the following nine working days. For a short illness the difference is the entire allowance.

• ·Pension accrual, at 1.5% of work income per year.
• ·Sickness allowance – the 2026 minimum is about €32 per working day, and at a low work income the allowance stays close to it.
• ·Parental allowances: pregnancy allowance, special pregnancy allowance and parental allowance.
• ·Rehabilitation allowance, and the projected accrual in a disability pension.
• ·Access to earnings-related unemployment cover – the subject of the next section.

Unemployment cover: the €15,481 threshold

This is the sharpest edge in the system, and the one that catches people out most often. YEL insurance on its own gives no earnings-related unemployment cover at all. Two things are needed at once: membership of an entrepreneurs unemployment fund (yrittäjäkassa) and YEL work income of at least €15,481 a year at the 2026 level.

The entrepreneur work condition is met once you have been self-employed for at least 15 months within the previous 48, with the pension insurance in force at or above that level throughout those months. The periods need not be continuous: any spell of at least four months counts towards the 15. The 48-month review period can be extended to a maximum of seven years for an acceptable reason such as illness, childcare or study.

The condition does not accrue during sickness allowance or pregnancy allowances. Someone who has moved over from an employee fund also has a grace rule: if the self-employment lasted under 18 months, the previously accumulated employee work condition is still available. The size of the allowance can be estimated with the earnings-related allowance calculator.

Paying it, and deducting it

The YEL contribution is fully deductible, but only by one route at a time. There are three ways to claim it, and the choice is worth making according to which taxation is the heavier.

• ·As a business expense on Form 5, in which case the contribution reduces the result of the business.
• ·On your own tax return, as an other deduction from earned income, where the benefit equals your marginal rate.
• ·On your spouse tax return in the same way, if the spouse meets the tax definition of a spouse.
• ·It cannot be claimed twice: if the contribution sits in the accounts of the business but is deducted personally, it is entered on Form 5 as a non-deductible expense.

The contribution can be split into 1, 2, 3, 4, 6 or 12 instalments a year. The number of instalments affects the total through interest, and the cheapest option is to pay the whole year at once in January. An unpaid contribution accrues late-payment interest from the due date, and a separate fee is charged for a reminder. In annual planning YEL is worth counting together with advance tax, because both land on the same cash flow.

The flexible YEL contribution

The contribution can be flexed each year without changing the confirmed work income. Upwards it can be flexed by 10–100%, once a year. Downwards by 10–20%, but no more than three times within any seven consecutive years. A flex is valid one year at a time and must be notified separately each year.

Flexing is not available if the insurance has not been in force for the whole year with the same provider, if there are unpaid YEL contributions, if you are already drawing a work pension, or if you are using the new-entrepreneur discount. The basic contribution and the flex together cannot exceed the €214,000 ceiling.

The key limitation is this: flexing does not change the confirmed work income. Social benefits are still calculated from that figure, and the effect of the flex shows up only in pension accrual. Flexing upwards in a good year therefore increases your pension but not your sickness allowance.

Four expensive mistakes

The first is setting work income at the floor because the contribution feels large. It is a cheap decision whose bill arrives later and all at once: a small pension, sickness and parental allowances near the minimum, and no earnings-related unemployment cover whatsoever.

The second is not knowing that work income cannot be changed retroactively. It is confirmed forward only, so it cannot be raised after you have fallen ill, after a pregnancy has begun or after the work has dried up. Combined with the 12-month reference period at Kela, that means an increase made today shows up in full only about a year from now. Accrual and the holes in it are worth looking at through the pension gaps article as well.

The third is leaving the review proposal unanswered. Silence does not preserve the old figure; it hands the decision to the pension company.

The fourth is not taking out the insurance at all. Eläketurvakeskus supervises compliance, first asks you to put it right, and ultimately takes out the insurance at the expense of the entrepreneur. For the period of neglect the contribution can be raised up to double. Insurance can be taken out retroactively only for the current year and the three preceding ones – for anything older, pension cover can no longer be accrued by any means.