YEL calculator updated as second review round begins

Pension insurers will review the YEL income of 67,000 business owners this year.

A second round of reviews of YEL income will begin this year. In 2026, the reviews will apply to business owners whose YEL insurance has been in force for at least three years. According to estimates from the pension insurers, around 67,000 people will be reviewed this year.

Regular reviews of YEL income began in 2023. The legislative reform that entered into force at the start of 2023 requires pension insurance companies to reassess business owners’ YEL income every three years.

At most, confirmed YEL income can rise by €4,000 in a review. This maximum increase applies to the first two review rounds and to all business owners insured under YEL during the transition period defined in the 2023 reform, which runs until the end of 2028.

The 2023 entrepreneur pension or YEL reform affected YEL policies that existed when the law entered into force. The transition period was sharply criticized by business owners with YEL policies which entered into force on or after 1 Jan. 2023.

In 2026, YEL income reviews also begin for business owners who took out insurance in 2023. As a result of advocacy work by Suomen Yrittäjät, the Finnish SME association, the €4,000 maximum increase will also apply to them.

Calculator updated

The calculator used in connection with YEL income reviews has attracted extensive criticism from business owners. In some cases, business owners have even received what they consider arbitrary YEL income proposals, as turnover has been used as a benchmark when assessing the scale of their business activity.

The Finnish Centre for Pensions (ETK) says that business owners under review who gave feedback to the pension providers criticized the fact that YEL income is assessed on the basis of turnover. Feedback also highlighted that turnover does not take account of a company’s costs.

The Finnish Centre for Pensions has now updated the calculator. From the start of 2026, it caps the recommended YEL income at no more than 60% of a business owner’s turnover. The Centre said the change is based on experience gained and “supports the accuracy of YEL income, particularly in small-scale business activity”.

Until the turn of the year, the calculator limited the recommendation to prevent it from exceeding the business owner’s turnover.

“Should be abolished”

Suomen Yrittäjät has repeatedly criticized the use of turnover in determining YEL income.

“The YEL calculator has failed and can serve only as a rough indicative tool. Turnover figures in themselves tell you nothing about a business owner’s work input or its value,” Harri Hellstén, Labour Market Affairs Manager at Suomen Yrittäjät, the Finnish SME association, said last summer.

When the rapporteur’s YEL report was published in December, Atte Rytkönen-Sandberg, a Vice President at Suomen Yrittäjät, was ready to scrap the calculator altogether.

“The YEL income calculator used by pension providers, which often produces arbitrary proposals, should be abolished, or at the very least replaced with a new tool for determining YEL income,” Rytkönen-Sandberg said at the time.

YEL reform

Petteri Orpo’s government is reforming the Entrepreneur’s Pension Act. In this context, the YEL report by rapporteur Jukka Rantala was published shortly before Independence Day. Suomen Yrittäjät, the Finnish SME association, stated as soon as the report was released that it cannot serve as the basis for further legislative drafting of the YEL reform.

Suomen Yrittäjät would reform the pension legislation as follows:

Business owners’ freedom to determine their pension cover and contributions must be increased.

The minimum threshold for mandatory insurance must be raised from its current level to the minimum threshold for earnings-related unemployment security.

Legislation must be amended to treat the business owner’s own declaration of their work input as the starting point for YEL income.

The current calculator must be scrapped.

Running a business must not be made more difficult through blanket contribution increases.

The pension system must be made more efficient and its flexibility increased.

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Toimitus

toimitus@yrittajat.fi