Good to know
Local Currency: Euro (EUR)
Minimum Salary: There is no national minimum wage in Finland.
In most sectors, the collective agreement defines the minimum wage and various working conditions.
Salary Calculation: gross to net
Legal Working Hours: the maximum legal working time is 8 hours per day and 40 hours per week in Finland.
Paid Leave: Workers are entitled to paid leave – two days or two and a half days per month of the reference period (between April 1 and March 31), depending on the length of the employment contract.
Source: European Commission
About Finland
Finland or the Republic of Finland is a country in Northern Europe. In 2022, and for the 5th year in a row, Finland has been recognized as the happiest country in the world. The country attracts many workers and companies for its quality of life but also for its beautiful landscape.
The Finnish economy is based on abundant forest resources, capital investments and technology. Finland’s economy is characterized by many innovative and fast-growing business sectors.
Fun Fact: Two thirds of the country’s land area is covered by forest. That’s why the wood industry is a major economic sector in the country.
Are you looking to settle in Finland? Do you need help with payroll or human resources management? Our Finnish payroll and HR experts will ensure that your company complies with national legislation.
Ready to Benefit from Finnish HR & Payroll Experts?
The Finnish Social Security System (for employees)
The Finnish social security system includes sickness and maternity insurance, occupational accidents and diseases, national pensions, occupational pensions and unemployment insurance, as well as family benefits.
All residents are covered for national pension insurance, sickness and maternity insurance and family benefits.
Employed persons are also entitled to certain benefits in respect of their activity: compulsory occupational pensions (TyEL), partial sickness benefit, benefits for accidents at work and occupational diseases, and earnings-related unemployment benefits.
Source : The Cleiss
Administrative Organization
Supervision
The Ministry of Social Affairs and Health (Sosiaali- ja terveysministeriö) is responsible for the development of social policy and the supervision of the social security system for all branches.
Insurance Management Bodies
The Social Insurance Institution of Finland (Kansaneläkelaitos – Kela) administers basic social security (national pensions, disability benefits, sickness and maternity insurance, family benefits, minimum income guarantees and basic unemployment coverage). Kela is also responsible for basic social assistance.
The municipalities are responsible for certain social services (in addition to the assistance provided by Kela) and health services.
Insurance companies and pension funds are responsible for income-related occupational pension insurance. In the private sector, occupational pensions are managed by about 20 pension providers. The activity of these institutions is monitored by the Finnish Centre for Pensions (Eläketurvakeskus – ETK).
Occupational accident and disease insurance is managed by private insurance companies. The Finnish Workers’ Compensation Center (Tapaturmavakuutuskeskus -TVK) – is responsible for coordinating the activities of insurance companies.
Earnings-related unemployment benefits are administered by the unemployment insurance funds. Membership in these funds is usually optional. There are 21 unemployment insurance funds (työttömyyskassaa) in Finland, whose activities are supervised by the Financial Supervisory Authority (Finanssivalvonta). Some of the funds are industry-specific or union-related, while others are open to all employees.
Source : The Cleiss
Social contributions in Finland
Contributions are deducted from the entire salary (there is no ceiling).
Occupational pension and unemployment insurance contributions are tax-deductible.
Employer & Employee Contributions
Employer & Employee Contributions as of January 1, 2022 | ||||
| Risk | Employer | Employee | ||
| Sickness and maternity | 1.34% | 1.71% (1) | ||
| Occupational pensions (TyEL) (2) | 17.40% on average (3) | Under 53 years old: 7.15% From 53 to 62 years old (included) : 8.65% 63 years and older: 7.15% | ||
| Unemployment | 0.50% / 2.05% (4) | 1.50% (5) | ||
| Accidents at work and occupational diseases | variable (6) | – | ||
Notes
(1) i.e. 0.53% for health care and 1.18% to finance daily allowances. The contribution paid for daily allowance coverage is not due by employees whose annual income is less than €15,128.
(2) The employer is required to insure all employees between the ages of 17 and 67 ( included) whose salaries amount to at least 62.88€ per month.
(3) The employer’s rate varies according to the size of the company and the number of disability pensions paid to employees. It can also be modulated according to the company (client bonus provided for in the insurance contract).
(4) Up to €2,197,500 of the annual payroll, the rate retained is 0.50%, it is increased to 2.05% for the portion of salaries exceeding this amount.
Employers who pay their employees less than €1,300 per year withhold the employee contribution but are not required to contribute to the unemployment insurance fund.
Unemployment insurance contributions (employee and employer) are paid only for employees aged 17 to 64 included. As of August 1, 2022, the obligation to contribute no longer applies to employees under the age of 18.
(5) In addition to this compulsory coverage (toimeentuloturva), which entitles the employee to a flat-rate daily allowance (peruspäiväraha) paid by Kela (Social Insurance Institute), the employee may decide to join an unemployment insurance fund in order to receive income-related daily allowances (ansioperusteinen sosiaaliturva). Depending on the fund, the insurance premiums may be a flat rate or a percentage of the employee’s salary. The employee pays the premiums directly to the insurance company.
(6) The employer is required to subscribe to an insurance policy with a private company if the total amount of remuneration paid in a year exceeds € 1,300. The insurance must be taken out before the start of the activity. The contribution rate varies according to the payroll and the risk specific to the sector to which the company belongs (from 0.05€ to 5%). It can also vary from one insurer to another. On average, the contribution amounts to 0.70%. In addition to accident insurance, most employers are required to take out group life insurance for their employees under the collective agreement that applies to their company. The contribution is paid exclusively by the employer. The average contribution is 0.06% of the total payroll.
Source : The Cleiss
Source : The Cleiss
Collection
Contributions (employer and employee) are paid by the employer:
- to the insurance company or pension fund to which they belong (occupational pension contributions);
- to the private company of their choice for the contribution to the workmen’s compensation insurance and for the contribution to the group life insurance.
- to the Employment Fund for the contribution for the unemployment risk (invoiced in April, July, October and January).
Please note: Remuneration and social security contributions paid to/for an insured person under the Finnish plan must be reported to the Incomes Register.
The other contributions, for sickness and maternity insurance, are collected by the Tax Authority (VERO Skatt). As a rule, they are due by the 12th day of the month. In some cases, small companies can agree on a quarterly payment of contributions.
Source : The Cleiss
Tax on wages
If a worker spends more than six months in Finland, they generally have to pay taxes on their earnings.
If the employer is Finnish, the percentage of the worker’s taxes will be determined according to the income for the whole year. The percentage increases as the salary income increases. It is also necessary to have a Finnish personal identification number and a tax card.
A tax card (verokortti) is required when an employee receives a salary or other income in Finland. The tax percentage is indicated on the card so that the employer knows how much tax to deduct from the salary.
The Finnish Tax Authority (Vero Skatt) is the body that issues the tax cards and the tax number.
If the employer is a foreigner and the employee is in Finland for a maximum of six months, the employee is not required to pay taxes in Finland.
Our HR & Payroll Experts are Ready to Help
Payroll and HR are different in each country and to each business. Trust one of our local experts to ensure your company’s compliance in Finland.
Our Payroll and HR services in Finland
- Implementation and testing of the software
- An understanding of your individual business payroll processes
- Online payslips & payments
- A dedicated payroll expert
- Data entry & processing
- Payslip distribution
- Personnel & document production
- Legislation compliance
- Highly secure
HR & Payroll in Finland
HR & Payroll in Finland
Good to know
Local Currency: Euro (EUR)
Minimum Salary: There is no national minimum wage in Finland.
In most sectors, the collective agreement defines the minimum wage and various working conditions.
Salary Calculation: gross to net
Legal Working Hours: the maximum legal working time is 8 hours per day and 40 hours per week in Finland.
Paid Leave: Workers are entitled to paid leave – two days or two and a half days per month of the reference period (between April 1 and March 31), depending on the length of the employment contract.
Source: European Commission
Ready to Benefit from Finnish HR & Payroll Experts?
About Finland
Finland or the Republic of Finland is a country in Northern Europe. In 2022, and for the 5th year in a row, Finland has been recognized as the happiest country in the world. The country attracts many workers and companies for its quality of life but also for its beautiful landscape.
The Finnish economy is based on abundant forest resources, capital investments and technology. Finland’s economy is characterized by many innovative and fast-growing business sectors.
Fun Fact: Two thirds of the country’s land area is covered by forest. That’s why the wood industry is a major economic sector in the country.
Are you looking to settle in Finland? Do you need help with payroll or human resources management? Our Finnish payroll and HR experts will ensure that your company complies with national legislation.
The Finnish Social Security System (for employees)
The Finnish social security system includes sickness and maternity insurance, occupational accidents and diseases, national pensions, occupational pensions and unemployment insurance, as well as family benefits.
All residents are covered for national pension insurance, sickness and maternity insurance and family benefits.
Employed persons are also entitled to certain benefits in respect of their activity: compulsory occupational pensions (TyEL), partial sickness benefit, benefits for accidents at work and occupational diseases, and earnings-related unemployment benefits.
Administrative Organisation
Supervision
The Ministry of Social Affairs and Health (Sosiaali- ja terveysministeriö) is responsible for the development of social policy and the supervision of the social security system for all branches.
Insurance Management Bodies
The Social Insurance Institution of Finland (Kansaneläkelaitos – Kela) administers basic social security (national pensions, disability benefits, sickness and maternity insurance, family benefits, minimum income guarantees and basic unemployment coverage). Kela is also responsible for basic social assistance.
The municipalities are responsible for certain social services (in addition to the assistance provided by Kela) and health services.
Insurance companies and pension funds are responsible for income-related occupational pension insurance. In the private sector, occupational pensions are managed by about 20 pension providers. The activity of these institutions is monitored by the Finnish Centre for Pensions (Eläketurvakeskus – ETK).
Occupational accident and disease insurance is managed by private insurance companies. The Finnish Workers’ Compensation Center (Tapaturmavakuutuskeskus -TVK) – is responsible for coordinating the activities of insurance companies.
Earnings-related unemployment benefits are administered by the unemployment insurance funds. Membership in these funds is usually optional. There are 21 unemployment insurance funds (työttömyyskassaa) in Finland, whose activities are supervised by the Financial Supervisory Authority (Finanssivalvonta). Some of the funds are industry-specific or union-related, while others are open to all employees.
Source : The Cleiss
Social contributions in Finland
Contributions are deducted from the entire salary (there is no ceiling).
Occupational pension and unemployment insurance contributions are tax-deductible.
Employer & Employee Contributions
Employer & Employee Contributions as of January 1, 2022 | ||||
| Risk | Employer | Employee | ||
| Sickness and maternity | 1.34% | 1.71% (1) | ||
| Occupational pensions (TyEL) (2) | 17.40% on average (3) | Under 53 years old: 7.15% From 53 to 62 years old (included) : 8.65% 63 years and older: 7.15% | ||
| Unemployment | 0.50% / 2.05% (4) | 1.50% (5) | ||
| Accidents at work and occupational diseases | variable (6) | – | ||
Notes
(1) i.e. 0.53% for health care and 1.18% to finance daily allowances. The contribution paid for daily allowance coverage is not due by employees whose annual income is less than €15,128.
(2) The employer is required to insure all employees between the ages of 17 and 67 ( included) whose salaries amount to at least 62.88€ per month.
(3) The employer’s rate varies according to the size of the company and the number of disability pensions paid to employees. It can also be modulated according to the company (client bonus provided for in the insurance contract).
(4) Up to €2,197,500 of the annual payroll, the rate retained is 0.50%, it is increased to 2.05% for the portion of salaries exceeding this amount.
Employers who pay their employees less than €1,300 per year withhold the employee contribution but are not required to contribute to the unemployment insurance fund.
Unemployment insurance contributions (employee and employer) are paid only for employees aged 17 to 64 included. As of August 1, 2022, the obligation to contribute no longer applies to employees under the age of 18.
(5) In addition to this compulsory coverage (toimeentuloturva), which entitles the employee to a flat-rate daily allowance (peruspäiväraha) paid by Kela (Social Insurance Institute), the employee may decide to join an unemployment insurance fund in order to receive income-related daily allowances (ansioperusteinen sosiaaliturva). Depending on the fund, the insurance premiums may be a flat rate or a percentage of the employee’s salary. The employee pays the premiums directly to the insurance company.
(6) The employer is required to subscribe to an insurance policy with a private company if the total amount of remuneration paid in a year exceeds € 1,300. The insurance must be taken out before the start of the activity. The contribution rate varies according to the payroll and the risk specific to the sector to which the company belongs (from 0.05€ to 5%). It can also vary from one insurer to another. On average, the contribution amounts to 0.70%. In addition to accident insurance, most employers are required to take out group life insurance for their employees under the collective agreement that applies to their company. The contribution is paid exclusively by the employer. The average contribution is 0.06% of the total payroll.
Source : The Cleiss
Collection
Contributions (employer and employee) are paid by the employer:
- to the insurance company or pension fund to which they belong (occupational pension contributions);
- to the private company of their choice for the contribution to the workmen’s compensation insurance and for the contribution to the group life insurance.
- to the Employment Fund for the contribution for the unemployment risk (invoiced in April, July, October and January).
Please note: Remuneration and social security contributions paid to/for an insured person under the Finnish plan must be reported to the Incomes Register.
The other contributions, for sickness and maternity insurance, are collected by the Tax Authority (VERO Skatt). As a rule, they are due by the 12th day of the month. In some cases, small companies can agree on a quarterly payment of contributions.
Source : The Cleiss
Tax on wages
If a worker spends more than six months in Finland, they generally have to pay taxes on their earnings.
If the employer is Finnish, the percentage of the worker’s taxes will be determined according to the income for the whole year. The percentage increases as the salary income increases. It is also necessary to have a Finnish personal identification number and a tax card.
A tax card (verokortti) is required when an employee receives a salary or other income in Finland. The tax percentage is indicated on the card so that the employer knows how much tax to deduct from the salary.
The Finnish Tax Authority (Vero Skatt) is the body that issues the tax cards and the tax number.
If the employer is a foreigner and the employee is in Finland for a maximum of six months, the employee is not required to pay taxes in Finland.
Our HR & Payroll Experts are Ready to Help
Payroll and HR are different in each country and to each business. Trust one of our local experts to ensure your company’s compliance in Finland.
Our Payroll and HR services in Finland
- Implementation and testing of the software
- An understanding of your individual business payroll processes
- Online payslips & payments
- A dedicated payroll expert
- Data entry & processing
- Payslip distribution
- Personnel & document production
- Legislation compliance
- Highly secure
Good to know
Local Currency: Euro (EUR)
Minimum Salary: There is no national minimum wage in Finland.
In most sectors, the collective agreement defines the minimum wage and various working conditions.
Salary Calculation: gross to net
Legal Working Hours: the maximum legal working time is 8 hours per day and 40 hours per week in Finland.
Paid Leave: Workers are entitled to paid leave – two days or two and a half days per month of the reference period (between April 1 and March 31), depending on the length of the employment contract.
Source: European Commission
Ready to Benefit from Finnish HR & Payroll Experts?
About Finland
Finland or the Republic of Finland is a country in Northern Europe. In 2022, and for the 5th year in a row, Finland has been recognized as the happiest country in the world. The country attracts many workers and companies for its quality of life but also for its beautiful landscape.
The Finnish economy is based on abundant forest resources, capital investments and technology. Finland’s economy is characterized by many innovative and fast-growing business sectors.
Fun Fact: Two thirds of the country’s land area is covered by forest. That’s why the wood industry is a major economic sector in the country.
Are you looking to settle in Finland? Do you need help with payroll or human resources management? Our Finnish payroll and HR experts will ensure that your company complies with national legislation.
The Finnish Social Security System (for employees)
The Finnish social security system includes sickness and maternity insurance, occupational accidents and diseases, national pensions, occupational pensions and unemployment insurance, as well as family benefits.
All residents are covered for national pension insurance, sickness and maternity insurance and family benefits.
Employed persons are also entitled to certain benefits in respect of their activity: compulsory occupational pensions (TyEL), partial sickness benefit, benefits for accidents at work and occupational diseases, and earnings-related unemployment benefits.
Source : The Cleiss
Administrative Organisation
Supervision
The Ministry of Social Affairs and Health (Sosiaali- ja terveysministeriö) is responsible for the development of social policy and the supervision of the social security system for all branches.
Insurance Management Bodies
The Social Insurance Institution of Finland (Kansaneläkelaitos – Kela) administers basic social security (national pensions, disability benefits, sickness and maternity insurance, family benefits, minimum income guarantees and basic unemployment coverage). Kela is also responsible for basic social assistance.
The municipalities are responsible for certain social services (in addition to the assistance provided by Kela) and health services.
Insurance companies and pension funds are responsible for income-related occupational pension insurance. In the private sector, occupational pensions are managed by about 20 pension providers. The activity of these institutions is monitored by the Finnish Centre for Pensions (Eläketurvakeskus – ETK).
Occupational accident and disease insurance is managed by private insurance companies. The Finnish Workers’ Compensation Center (Tapaturmavakuutuskeskus -TVK) – is responsible for coordinating the activities of insurance companies.
Earnings-related unemployment benefits are administered by the unemployment insurance funds. Membership in these funds is usually optional. There are 21 unemployment insurance funds (työttömyyskassaa) in Finland, whose activities are supervised by the Financial Supervisory Authority (Finanssivalvonta). Some of the funds are industry-specific or union-related, while others are open to all employees.
Source : The Cleiss
Social contributions in Finland
Contributions are deducted from the entire salary (there is no ceiling).
Occupational pension and unemployment insurance contributions are tax-deductible.
Employer & Employee contributions
Employer & Employee Contributions as of January 1, 2022 | ||||
| Risk | Employer | Employee | ||
| Sickness and maternity | 1.34% | 1.71% (1) | ||
| Occupational pnsions (TyELe) (2) | 17.40% on average (3) | Under 53 years old: 7.15% From 53 to 62 years old (included) : 8.65% 63 years and older: 7.15% | ||
| Unemployment | 0.50% / 2.05% (4) | 1.50% (5) | ||
| Accidents at work and occupational diseases | variable (6) | – | ||
Notes
(1) i.e. 0.53% for health care and 1.18% to finance daily allowances. The contribution paid for daily allowance coverage is not due by employees whose annual income is less than €15,128.
(2) The employer is required to insure all employees between the ages of 17 and 67 ( included) whose salaries amount to at least 62.88€ per month.
(3) The employer’s rate varies according to the size of the company and the number of disability pensions paid to employees. It can also be modulated according to the company (client bonus provided for in the insurance contract).
(4) Up to €2,197,500 of the annual payroll, the rate retained is 0.50%, it is increased to 2.05% for the portion of salaries exceeding this amount.
Employers who pay their employees less than €1,300 per year withhold the employee contribution but are not required to contribute to the unemployment insurance fund.
Unemployment insurance contributions (employee and employer) are paid only for employees aged 17 to 64 included. As of August 1, 2022, the obligation to contribute no longer applies to employees under the age of 18.
(5) In addition to this compulsory coverage (toimeentuloturva), which entitles the employee to a flat-rate daily allowance (peruspäiväraha) paid by Kela (Social Insurance Institute), the employee may decide to join an unemployment insurance fund in order to receive income-related daily allowances (ansioperusteinen sosiaaliturva). Depending on the fund, the insurance premiums may be a flat rate or a percentage of the employee’s salary. The employee pays the premiums directly to the insurance company.
(6) The employer is required to subscribe to an insurance policy with a private company if the total amount of remuneration paid in a year exceeds € 1,300. The insurance must be taken out before the start of the activity. The contribution rate varies according to the payroll and the risk specific to the sector to which the company belongs (from 0.05€ to 5%). It can also vary from one insurer to another. On average, the contribution amounts to 0.70%. In addition to accident insurance, most employers are required to take out group life insurance for their employees under the collective agreement that applies to their company. The contribution is paid exclusively by the employer. The average contribution is 0.06% of the total payroll.
Source : The Cleiss
Collection
Contributions (employer and employee) are paid by the employer:
- to the insurance company or pension fund to which they belong (occupational pension contributions);
- to the private company of their choice for the contribution to the workmen’s compensation insurance and for the contribution to the group life insurance.
- to the Employment Fund for the contribution for the unemployment risk (invoiced in April, July, October and January).
Please note: Remuneration and social security contributions paid to/for an insured person under the Finnish plan must be reported to the Incomes Register.
The other contributions, for sickness and maternity insurance, are collected by the Tax Authority (VERO Skatt). As a rule, they are due by the 12th day of the month. In some cases, small companies can agree on a quarterly payment of contributions.
Source : The Cleiss
Tax on wages
If a worker spends more than six months in Finland, they generally have to pay taxes on their earnings.
If the employer is Finnish, the percentage of the worker’s taxes will be determined according to the income for the whole year. The percentage increases as the salary income increases. It is also necessary to have a Finnish personal identification number and a tax card.
A tax card (verokortti) is required when an employee receives a salary or other income in Finland. The tax percentage is indicated on the card so that the employer knows how much tax to deduct from the salary.
The Finnish Tax Authority (Vero Skatt) is the body that issues the tax cards and the tax number.
If the employer is a foreigner and the employee is in Finland for a maximum of six months, the employee is not required to pay taxes in Finland.
Our HR & Payroll Experts are Ready to Help
Payroll and HR are different in each country and to each business. Trust one of our local experts to ensure your company’s compliance in Finland.
Our Payroll and HR services in Finland
- Implementation and testing of the software
- An understanding of your individual business payroll processes
- Online payslips & payments
- A dedicated payroll expert
- Data entry & processing
- Payslip distribution
- Personnel & document production
- Legislation compliance
- Highly secure