# YEL insurance in Finland 2026: cost, income and pension for the self-employed

What the compulsory pension insurance for the self-employed costs in 2026, how YEL income is set, and what it does to your pension and Kela benefits, with a worked example.

- URL: https://siltanova.com/yel-insurance-finland/
- Format: Explainer · Business
- By: SiltaNova Editorial
- Published: 3 Nov 2026
- Publisher: SiltaNova (https://siltanova.com), Finland

## Short answer

YEL insurance is compulsory pension insurance for self-employed people in Finland. In 2026 the contribution is 24.4% of your confirmed YEL income, with a 22% discount for newly self-employed people in their first 48 months. You must insure within six months of starting if you meet the conditions, including estimated earnings of EUR 9,423.09 a year or more.

## Key takeaways

- The 2026 YEL contribution is 24.4% of confirmed YEL income for all self-employed persons, and it is fully tax-deductible.
- Take out YEL insurance within six months of starting self-employment; the insurance is taken from the start of the business.
- Newly self-employed people get a 22% discount on the contribution for their first 48 months; ETK gives the resulting rate as about 19%.
- YEL income, not business profit, sets your contribution, your pension accrual and the base for several Kela benefits.
- The YEL minimum (EUR 9,423.09) and the unemployment-fund threshold (EUR 15,481) are two different figures.

YEL insurance is the pension cover that self-employed people in Finland must arrange for themselves when they meet the conditions[2]. It also sets the income on which several Kela benefits are calculated. This guide uses 2026 figures only. If you are still choosing how to start, read our [guide to starting a business in Finland](https://siltanova.com/start-a-business-in-finland/) first.

## Who must take YEL insurance?

ETK, the Finnish Centre for Pensions (Eläketurvakeskus), says insurance is mandatory when all of these hold[2]:

- You are at least 18 and below the upper age limit. The insurance obligation ends at 68 if you were born in 1957 or earlier, at 69 if born in 1958 to 1961, and at 70 if born in 1962 or later.[2]
- You have worked as a self-employed person for at least four months.[2]
- Your estimated annual earnings from the work are at least EUR 9,423.09 in 2026.[2]

Työeläke.fi, the pension sector's site, says the rule covers partners in a general partnership, an active partner in a limited partnership, and a person in a leading position in a limited company who owns more than 30% alone, or more than 50% with family members, of the company or its votes. Owning is not enough: you must also work in the company. The same rule applies to a light entrepreneur (kevytyrittäjä) or an independent worker[6]. Which business form you pick is a separate question, covered in our comparison of toiminimi (private trader) and Oy (limited company). If you work as an entrepreneur alongside a statutory old-age pension, YEL insurance is voluntary[3].

## When must you take out YEL insurance, and what if you do not?

The deadline is six months from the start of self-employment[2]. ETK's Finnish FAQ adds that the insurance is taken retroactively from the start of the business[3].

ETK supervises the obligation. It first urges you to correct the omission. If you ignore that, ETK takes out YEL insurance on your behalf and at your expense. You can insure retroactively only for the current year and the three previous years, and a year whose contributions are wholly unpaid counts as EUR 0 when the pension is calculated[2].

## How is your YEL income decided?

YEL income is the monetary value of your own work input. Työeläke.fi gives a rule of thumb: it should correspond to the wage you would pay a worker you hired to do the same work[5]. ETK's FAQ notes that the company's financial result does not decide it[3].

Your pension provider confirms the income on your application. All providers use the same calculation service, and its recommendation has leeway of plus or minus 30%. You get an appealable decision with grounds. The confirmed income cannot be changed retroactively, and providers review it every three years. Use the [recommended income calculator on Työeläke.fi](https://www.tyoelake.fi/en/pensions-for-the-self-employed/what-is-yel-income/)[5] before you apply.

## How much does YEL insurance cost in 2026?

**24.4%** YEL contribution in 2026, for all self-employed persons, of confirmed YEL income (Source: [ETK, Self-employed](https://www.etk.fi/en/finnish-pension-system/pensions/pension-coverage-and-insurance/self-employed/), 7 Oct 2026)

**EUR 9,423.09** Lower YEL income limit in 2026; the upper limit is EUR 214,000 (Source: [ETK, Usein kysyttyä YEL-vakuuttamisesta](https://www.etk.fi/suomen-elakejarjestelma/elaketurva/tyoelaketurvan-kattavuus-ja-vakuuttaminen/usein-kysyttya-yel-vakuuttamisesta/), 7 Oct 2026)

In 2026 the YEL contribution is 24.4% of your confirmed YEL income for all self-employed persons, and it is fully tax-deductible[2]. There are no age bands in 2026. The lower limit for YEL income is EUR 9,423.09 and the upper limit is EUR 214,000, both indexed every year[3]. Kela's page gives the same EUR 9,423.09 minimum[14].

Newly self-employed people get a 22% discount on the contribution, irrespective of age, for the first 48 months of self-employment[2]. ETK's FAQ ties it to YEL self-employment that began for the first time on or after 1 Jan 2013[3]. ETK gives the resulting rate for a starting entrepreneur as about 19%[4]. The exact figure used below, 19.032%, is our own arithmetic (24.4% x 0.78), not an ETK number.

## What does your YEL income affect?

Your pension amount and contribution are based on your confirmed YEL income. So are sickness allowances, and your YEL income also affects unemployment allowance and parents' daily allowances[5]. For Kela benefits, your annual income includes your YEL income only for the time your insurance was in force during the reference period[10]. If your YEL income changed during that period, Kela uses the average confirmed income[14].

## What does YEL income of EUR 20,000 or EUR 40,000 mean in practice?

The table works through two chosen YEL incomes, with and without the new-entrepreneur discount. Both lie between the 2026 limits of EUR 9,423.09 and EUR 214,000 and above the EUR 15,481 unemployment-fund threshold. Monthly figures are the annual figure divided by 12. Instalment interest is ignored. Each row name links to the page that holds the rule.

*Worked example, 2026 figures. All results are our arithmetic from the cited rules, rounded to cents; checked 7 Oct 2026.*

| Step | YEL income EUR 20,000 | YEL income EUR 40,000 |
| --- | --- | --- |
| [Contribution before discount: income x 24.4%](https://www.etk.fi/en/finnish-pension-system/pensions/pension-coverage-and-insurance/self-employed/) | 20,000 x 0.244 = EUR 4,880.00 a year (EUR 406.67 a month) | 40,000 x 0.244 = EUR 9,760.00 a year (EUR 813.33 a month) |
| [New-entrepreneur discount: 22% of the contribution](https://www.etk.fi/en/finnish-pension-system/pensions/pension-coverage-and-insurance/self-employed/) | 4,880.00 x 0.22 = EUR 1,073.60 a year | 9,760.00 x 0.22 = EUR 2,147.20 a year |
| Contribution with discount (first 48 months) | 4,880.00 - 1,073.60 = EUR 3,806.40 a year (EUR 317.20 a month) | 9,760.00 - 2,147.20 = EUR 7,612.80 a year (EUR 634.40 a month) |
| [Resulting rate (ETK says about 19%)](https://www.etk.fi/suomen-elakejarjestelma/rahoitus-ja-sijoitustoiminta/tyoelakemaksut/yrittajien-elakemaksut-yel-ja-myel/) | 3,806.40 / 20,000 = 19.032% | 7,612.80 / 40,000 = 19.032% |
| [Pension accrued per year of insurance: 1.5% of income](https://www.tyoelake.fi/en/pensions-for-the-self-employed/pension-amount-and-contributions/) | 20,000 x 0.015 = EUR 300.00 a year (EUR 25.00 a month) | 40,000 x 0.015 = EUR 600.00 a year (EUR 50.00 a month) |
| [Sickness allowance per working day, Kela formula](https://www.kela.fi/annual-income-calculation) | Band 13,713-28,899: 0.7 x (20,000 / 300) = EUR 46.67 | Band above 28,899: 0.7 x (40,000 / 300) - 0.55 x ((40,000 - 28,899) / 300) = 93.33 - 20.35 = EUR 72.98 |
| [Parental allowance per working day, Kela formula](https://www.kela.fi/annual-income-calculation) | Band 13,713-45,744: 0.7 x 20,000 / 300 = EUR 46.67 | Band 13,713-45,744: 0.7 x 40,000 / 300 = EUR 93.33 |
| [Earnings-related unemployment allowance: YEL income test](https://www.tyoelake.fi/en/pensions-for-the-self-employed/social-security-of-the-self-employed-based-on-confirmed-income/) | Above EUR 15,481: income test met. Other conditions apply. No amount calculated here. | Above EUR 15,481: income test met. Other conditions apply. No amount calculated here. |

How to read it. The contribution is YEL income x 24.4%; the discount takes 22% off that amount. The pension accrual is 1.5% of confirmed annual income, which Työeläke.fi applies in its own EUR 28,000 example (EUR 35 a month)[8]. Kela says the same formulas apply to employees and self-employed persons, with annual income for YEL-insured people defined as their YEL earnings. Each figure is per working day, Monday to Saturday[9]. Neither Kela's formulas nor the accrual rule use the contribution you pay, so the discount changes your cost but not these benefit steps.

Check against Kela. Kela's own example has a YEL income of EUR 20,000 and a sickness allowance of approximately EUR 47 per weekday, which matches our EUR 46.67[10]. The EUR 40,000 case is our application of Kela's formula, not a Kela example. Kela's page also has a separate formula for the first 16 working days of pregnancy and parental allowance, which the table does not use[9]. Other conditions for each allowance are on Kela's pages.

## Does YEL give you unemployment security?

Only if your YEL income is high enough and you meet the other conditions. For the earnings-related allowance through the Entrepreneur Fund, Työeläke.fi lists self-employment for at least 15 of the 48 months before unemployment, fund membership at the same time, and a confirmed YEL income of at least EUR 15,481 in 2026[7]. That is a separate figure from the EUR 9,423.09 YEL minimum. If you are not in an unemployment fund, Kela's page points to the general social security benefit (yleistuki)[15].

## Do foreign entrepreneurs need YEL insurance?

Nationality makes no difference to the obligation[11]. ETK's FAQ adds that you may not have to insure in Finland if the EU social security regulation or a social security agreement says so[12]. Työeläke.fi lists, among the conditions, that you live in Finland[6]. Read both pages for your case, because they are worded differently.

> **Pages that mix years** ETK's English page for self-employed people coming to Finland was last modified on 25 Mar 2025 and still shows a 2025 earnings limit. This guide takes the 2026 limit from ETK's 2026 pages and Työeläke.fi, and uses the older page only for the nationality principle.

## Is the YEL system about to change?

ETK says the Government's view on reforming the pension system for the self-employed was confirmed in the government budget session on 22 April 2026[13]. This guide describes the 2026 rules as ETK and Työeläke.fi publish them. Read ETK's reform page before you rely on any later change.

## Frequently asked questions

### Do I need YEL insurance for a side business?

The same conditions apply. Työeläke.fi says the rules also cover light entrepreneurs and independent workers, and that owning a company is not enough: you must work in it. If your self-employment has lasted at least four months and your estimated earnings reach EUR 9,423.09 a year in 2026, insurance is required.

### Can I choose YEL if I already draw an old-age pension?

Yes, it becomes voluntary. ETK's FAQ says YEL insurance is voluntary if you work as an entrepreneur alongside a statutory old-age pension. The compulsory rule applies to people who meet the conditions and are not drawing such a pension.

### Can I change my YEL income later?

Yes, but not backwards. Työeläke.fi says the confirmed income cannot be amended retroactively, so agree changes with your pension provider when your work input changes. Providers also review YEL income every three years and can raise it by at most EUR 4,000 each time in the first reviews.

### Which companies sell YEL insurance?

ETK's FAQ names four pension insurers: Elo, Ilmarinen, Varma and Veritas. Two pension funds, Apteekkien eläkekassa and Eläkekassa Verso, serve limited industries. You choose the provider yourself, and ETK's FAQ says one YEL policy is enough to cover all your businesses.

### Is the YEL contribution tax-deductible?

Yes. ETK says the YEL insurance contribution is fully tax-deductible. The FAQ adds that the contributions are deducted either in your personal taxation or in your company's taxation. Check with your accountant or the Tax Administration which applies to your business form.

### What does YEL stand for?

YEL is the Finnish abbreviation of yrittäjän eläkevakuutus, the self-employed person's pension insurance. ETK's English pages call it YEL insurance. It builds your earnings-related pension and sets the confirmed income that several Kela benefits are calculated from, as explained in this guide.

## Sources

1. [YEL-yrittäjät (Finnish)](https://www.etk.fi/suomen-elakejarjestelma/elaketurva/tyoelaketurvan-kattavuus-ja-vakuuttaminen/yel-yrittajat/), Finnish Centre for Pensions (ETK) (accessed 7 Oct 2026)
2. [Self-employed](https://www.etk.fi/en/finnish-pension-system/pensions/pension-coverage-and-insurance/self-employed/), Finnish Centre for Pensions (ETK) (accessed 7 Oct 2026)
3. [Usein kysyttyä YEL-vakuuttamisesta (Finnish)](https://www.etk.fi/suomen-elakejarjestelma/elaketurva/tyoelaketurvan-kattavuus-ja-vakuuttaminen/usein-kysyttya-yel-vakuuttamisesta/), Finnish Centre for Pensions (ETK) (accessed 7 Oct 2026)
4. [Yrittäjien eläkemaksut YEL ja MYEL (Finnish)](https://www.etk.fi/suomen-elakejarjestelma/rahoitus-ja-sijoitustoiminta/tyoelakemaksut/yrittajien-elakemaksut-yel-ja-myel/), Finnish Centre for Pensions (ETK) (accessed 7 Oct 2026)
5. [What is YEL income?](https://www.tyoelake.fi/en/pensions-for-the-self-employed/what-is-yel-income/), Työeläke.fi (Finnish pension sector) (accessed 7 Oct 2026)
6. [When do I need insurance?](https://www.tyoelake.fi/en/pensions-for-the-self-employed/when-do-i-need-insurance/), Työeläke.fi (Finnish pension sector) (accessed 7 Oct 2026)
7. [Social security of the self-employed based on confirmed income](https://www.tyoelake.fi/en/pensions-for-the-self-employed/social-security-of-the-self-employed-based-on-confirmed-income/), Työeläke.fi (Finnish pension sector) (accessed 7 Oct 2026)
8. [Pension amount and contributions](https://www.tyoelake.fi/en/pensions-for-the-self-employed/pension-amount-and-contributions/), Työeläke.fi (Finnish pension sector) (accessed 7 Oct 2026)
9. [Annual income calculation](https://www.kela.fi/annual-income-calculation), Kela (accessed 7 Oct 2026)
10. [Annual income](https://www.kela.fi/what-is-annual-income), Kela (accessed 7 Oct 2026)
11. [Self-employed person to Finland (page last modified 25 Mar 2025)](https://www.etk.fi/en/international-affairs/to-finland-from-abroad/self-employed-person-to-finland/), Finnish Centre for Pensions (ETK) (accessed 7 Oct 2026)
12. [FAQs on YEL insurance](https://www.etk.fi/en/finnish-pension-system/pensions/pension-coverage-and-insurance/faqs-on-yel-insurance/), Finnish Centre for Pensions (ETK) (accessed 7 Oct 2026)
13. [Developing the pension system for the self-employed](https://www.etk.fi/en/finnish-pension-system/pension-reforms/developing-the-pension-system-for-the-self-employed/), Finnish Centre for Pensions (ETK) (accessed 7 Oct 2026)
14. [Self-employed persons: income and contributions to health insurance](https://www.kela.fi/self-employment-income-and-contributions), Kela (accessed 7 Oct 2026)
15. [Unemployment benefits for self-employed persons](https://www.kela.fi/self-employment-unemployment), Kela (accessed 7 Oct 2026)

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Cite as: SiltaNova Editorial, “YEL insurance in Finland 2026: cost, income and pension for the self-employed”, SiltaNova, 3 Nov 2026. https://siltanova.com/yel-insurance-finland/