Social security scheme
Taxes and social security payments sustain the national social insurance system. There are differences from one country to the next as to what charges are collected, as to the rates and percentages, and as to the names these charges have been given.
List of social security payments and contributions in Finland:
- The health insurance contribution of the insured (ca 2 %) that the insured individual has to pay, based on the net taxable earned income assessed for the purposes of municipal tax*
- Mandatory employment insurance contribution, the employer pays one part and the worker pays another part (ca 5-6 % of gross income).
- Unemployment insurance contribution, the employer pays one part and the worker pays another part (ca 1 % of gross income).
- Accident insurance contribution, paid by the employer.
- Group life insurance contribution, paid by the employer.
- The employer's social security contribution, paid by the employer.
*The health insurance contribution of the insured will usually be charged of the insured individual in Finland even if none of the individual's earned income were taxed. In addition, even nonresidents (living outside Finland), covered by the health insurance, usually have to pay the health insurance contribution of the insured.
No social security contributions will usually be charged of an individual arriving in Finland to start work in Finland if he or she carries the E101/A1 Certificate.
Deduction of social security contributions
If you are covered by the Swedish or Norwegian social security system, you pay your social security contributions there. If your income is taxed in Finland, you have the right to deduct the social security contributions in the Finnish income taxation.
You have the right to deduct the mandatory employment insurance contribution, unemployment insurance contribution and the daily allowance payment part of the health insurance contribution from your earned income. Payments abroad are also deductible if they are corresponding to Finnish payments.