Employer costs in Finland 2026: about 20 % on top of salary

Karma Accounts · Published 15 September 2026 · Updated 9 October 2026

In 2026 the statutory employer contributions in Finland come to about 19.9 % of gross salary, using the average employer TyEL pension contribution of 17.10 %. A salary of 3 000 euros a month therefore costs a small company about 3 600 euros, though your own pension and accident insurance rates can differ from the averages. The employee's share, 8.19 % plus tax, comes out of their pay.

Employer contributions 2026 at a glance

Contribution	Employer	Employee
TyEL pension, average	17.10 %	7.30 %
Health insurance contribution	1.91 %	in the tax card rate
Unemployment insurance	0.31 %	0.89 %
Unemployment insurance, payroll portion above 2 509 500 euros	1.23 %	0.89 %
Accident insurance, 2026 average	0.48 %	none
Group life insurance, 2026 average	0.053 %	none
Total for a small employer	about 19.9 %	8.19 %

Percentages of gross wages, for an ordinary employee covered by Finnish social insurance. Accident and group life are the Workers' Compensation Center's forecast averages.

Key payroll figures 2026

TyEL contract: needed once you employ at least one person on a continuing basis, or pay at least 10 272 euros in wages over six months. Below that you can be a temporary employer and pay TyEL without a contract (TyEL 147 §).
TyEL insurance: from the month after the employee turns 17, when they earn at least 71.72 euros in a calendar month, up to age 69 or 70 depending on year of birth.
Health insurance contribution: for employees aged 16 to 67.
Unemployment insurance: for employees aged 18 to 64. The employer pays once its wages exceed 1 500 euros in a calendar year; the employee's 0.89 % is withheld regardless, and below the limit it stays with the employer.
Accident insurance: compulsory once the wages you pay, or have agreed to pay, in a calendar year exceed 1 500 euros (the limit for 2024 to 2026).
YEL, if the employee is you: the lower income limit is 9 423.09 euros a year.
Incomes Register: each pay run within 5 days of payday; the employer's separate report by the 5th of the following month.
Payment: withheld tax and the health insurance contribution by the 12th of the month after the payday month.

What each contribution is

Earnings-related pension (TyEL). The total averages 24.40 % of wages in 2026. The employee's 7.30 % is the same at every age this year (in 2025 those aged 53 to 62 paid 8.65 %). Your own rate comes from your pension company: Varma, for example, gives a 2026 basic contribution of 24.85 % for a contract employer, plus the administration charge, less client bonuses. A temporary employer pays a slightly higher rate, 25.85 % in 2026 including the charge.

Unemployment insurance goes to the Employment Fund (Työllisyysrahasto); the employer's health insurance contribution (sairausvakuutusmaksu) goes to the Tax Administration, even when no tax is withheld.

Accident insurance. Statutory accident and occupational disease insurance (työtapaturma- ja ammattitautivakuutus) must be in place before the work begins; it cannot be taken out retroactively. Because an agreed wage counts towards the 1 500 euro limit, a first hire is usually over it before day one. The premium depends on the work and the insurer, from 0.05 % to 5 % of wages.

Group life insurance is compulsory when your sector's collective agreement requires it, which covers almost every employee in practice. It comes with the accident policy.

What you withhold from the employee

From the gross salary you deduct tax at the rate on the employee's tax card, using the card's additional rate on income above its annual limit; their pension contribution of 7.30 %; and their unemployment insurance contribution of 0.89 %. Their health insurance contribution is already inside the tax card rate. If you have no tax card details for the employee, on paper or electronically from the Tax Administration, you withhold 60 %. These amounts are included in the gross salary and create no additional employer cost: you withhold them and pay them on.

An example: 3 000 euros a month

An ordinary employee on 3 000 euros a month in a small company, at 2026 average rates:

Item	Rate	Euros a month
Gross salary		3 000.00
TyEL, employer's average share	17.10 %	513.00
Health insurance contribution	1.91 %	57.30
Unemployment insurance	0.31 %	9.30
Accident insurance, 2026 average	0.48 %	14.40
Group life insurance, 2026 average	0.053 %	1.59
Gross salary plus the listed employer contributions		3 595.59

That is about 43 100 euros a year. As a percentage, the contributions are 595.59 / 3 000 = 19.9 % of the salary. A monthly salary already covers pay during holidays, so do not add holiday pay again. A holiday bonus, statutory occupational healthcare (työterveyshuolto, which every employer must arrange) and other costs such as equipment come on top.

On the employee's side, 219.00 euros of pension and 26.70 euros of unemployment insurance come off, leaving 2 754.30 euros before tax.

Reporting to the Incomes Register

Every pay run goes to the Incomes Register (tulorekisteri) on an earnings payment report within five days of payday, the day the money is available to the employee; a deadline on a weekend or holiday moves to the next business day. The employer's separate report, due by the 5th of the following month, carries the month's health insurance contribution. Tax-free mileage and per diems are reported there too. When we report for you, this is what the Suomi.fi mandate is for.

With one employee you are usually a casual employer: you need not join the employer register, and if you are not in it you file the separate report only for months with wages. Registration becomes compulsory once, for example, you regularly pay two or more employees.

When the money goes out

The net salary is paid on payday; taxes and insurance contributions follow their own due dates, and each sits in the books as a liability until paid:

Tax Administration: withheld tax and the health insurance contribution, in MyTax by the 12th of the month after the payday month, or the next business day if the 12th is a weekend or holiday.
Pension company: a monthly TyEL invoice for both shares, normally due on the last day of the month after the payday month if you report on time.
Employment Fund: both shares of unemployment insurance, invoiced in April, July, October and January.
Accident insurer: the accident and group life premiums, on the insurer's invoice.

Holiday pay builds up every month

An employee earns two days of paid leave (lomapäivät, counted in weekdays including Saturdays) for each full holiday credit month (lomanmääräytymiskuukausi), a month with at least 14 working days or, under the alternative rule, 35 working hours. Once the employment has lasted a year by 31 March, it is 2.5 days. Leave earned but not taken at the end of your financial year is a holiday pay liability (lomapalkkavelka), booked under accrued liabilities together with the employer contributions on it. A holiday bonus (lomaraha) is not required by the Annual Holidays Act; collective agreements usually provide one, for example 50 % of the holiday pay, and then it is a real extra cost.

If the employee is you

If you work in a managing position in your own Oy and own more than 30 % of it alone, or more than 50 % together with family members, you are insured under YEL, the self-employed persons' pension, not TyEL, provided the other YEL conditions are also met. YEL work income is the value of your work, not the salary the company pays you. Voting rights count as well as shares. See also toiminimi or Oy and salary or dividends.

What we do

We run payroll for small employers from the first hire: the payslips, the Incomes Register reports, the payments on the 12th and the bookings behind them, holiday pay liability included. Payroll is 15 euros per payslip plus VAT 25.5 %, and we are based in Helsinki and work online across Finland. If you are about to hire, book an introduction and bring the salary you have in mind; we can go through the first month's numbers with you.

Sources

Please note: this is general information about Finnish rules, not advice for your own situation, and the rules change. Ask us before you act on it.

Payroll from the first hire

Payslips, the Incomes Register report within five days and the amounts to pay by the 12th worked out, for 15 € a payslip plus VAT. See payroll services.

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