YELvakuutusmaksuista

YELvakuutusmaksuista, or YEL insurance contributions, are mandatory payments made by entrepreneurs in Finland. These contributions are based on the entrepreneur's YEL work income, which is an estimate of the annual earnings from their self-employment. The YEL system is a social security scheme that aims to provide entrepreneurs with income security in situations such as illness, unemployment, or old age.

The purpose of YELvakuutusmaksuista is to fund the benefits provided by the Finnish Centre for Pensions (Kela) and the earnings-related pension system. These benefits include pensions, sickness allowances, and unemployment benefits. The contribution rate is determined annually and varies depending on the entrepreneur's age and the level of their YEL work income. Higher work income generally leads to higher contributions.

Entrepreneurs can deduct YELvakuutusmaksuista from their taxable income, which can reduce their tax burden. The calculation of YEL work income is crucial, as it directly impacts the amount of contributions and the eventual pension accrual. It is recommended that entrepreneurs regularly assess their YEL work income to ensure it accurately reflects their earnings and provides adequate social security coverage. The YEL system is administered by various pension insurance companies, and entrepreneurs can choose which company to insure themselves with.