YEL rate now uniform as age-based increase ended in 2025

An entrepreneur's earnings-related pension contribution is calculated as a percentage of the confirmed income (työtulo)Telp, and the rate is now the same for every entrepreneur regardless of ageTelp. The Ministry of Social Affairs and Health sets the YEL contribution percentage for the following calendar year by decree.Telp Payroll bureaux, accountants and pension-insurer staff with entrepreneur clients should apply the uniform rate and stop programming an age-based increase into 2026 calculationsTelp.

The uniform rate replaces an age-differentiated systemTelp that applied until 31 December 2025Telp. Until that date the contribution percentage was set separately for entrepreneurs under 53 and for those who had turned 53Telp, and a transition period running from the start of 2017 to the end of 2025Telp carried an additional age-based increased rateTelp. The page records the age-differentiated percentages as the regime in force until 31 December 2025.

The mechanics of the old bands still matter for records. The under-53 percentage equalled the average TyEL minimum-terms insurance contribution as a percentage of wages, computed without the share attributable to the increased contribution of employees who had turned 53. In the calendar year an entrepreneur turned 53, the under-53 percentage applied until the end of that year.

The transition-period increase applied from the start of the calendar year following the 53rd birthday until the end of the calendar year of the 63rd birthday.Telp During the transition the increased contribution was the YEL 114 § contribution plus 1.5 percentage points.Telp After the transition there is no longer any age-based increase in the entrepreneur's contribution.Telp The page's example illustrates the run-off: an entrepreneur who turned 53 on 3 June 2017 paid the increased rate from 1 January 2018, and because the 63rd birthday falls after the transition ends, the increased rate runs to the end of the transition, 31 December 2025.

The increase financed the higher accrual it accompanied. The increased contribution funded the extra cost of the accrual rate rising from the start of the calendar month after the 53rd birthday, and during the transition the pension accrued at 1.7 per cent per year from that month until the end of the calendar month of the 63rd birthday.

The age-based increase applied to both compulsorily and voluntarily insured entrepreneurial activity, running from the year after the 53rd birthday year to the 63rd birthday year regardless of how much pension the activity accrued. Activity alongside a pension also carried the increased contribution even though it accrues at 1.5 per cent, including voluntarily insured activity alongside an old-age pension.

Legal basis: Yrittäjän eläkelaki 114 § on the pension insurance contribution, applied alongside the Telp guidance page on the determination of the entrepreneur's contribution.