Payroll in Finland 2026: tax cards, TyEL and employer costs

In Finland the employer withholds income tax at the rate shown on the employee's tax card and deducts the employee's pension (TyEL, 7.30% in 2026) and unemployment insurance (0.89%) contributions. On top, it pays on average 17.10% TyEL, 1.91% health insurance, 0.31% unemployment insurance and accident insurance, and reports every payment to the Incomes Register.

Payroll in Finland at a glance

Social security contributions

Finnish social security for employees is financed through four channels: the earnings-related pension (TyEL), paid to a private pension insurer; unemployment insurance, invoiced by the Employment Fund; health insurance, collected by the Tax Administration; and compulsory accident insurance, bought from an insurer.

TyEL. The average total TyEL contribution for 2026 is 24.40% of wages: 7.30% from the employee and 17.10% from the employer on average; an individual employer's rate can differ from the average. The employee rate is now the same at every age; in 2025 employees aged 53 to 62 paid 8.65%. The employer deducts the employee's share from pay and pays the full contribution to its pension insurer.

Unemployment insurance. The employer pays both shares to the Employment Fund, which invoices four times a year (in April, July, October and January) on the basis of the pay reported to the Incomes Register, with 21 days to pay. The employer must deduct the employee's 0.89% even when its annual payroll is under €1,500.

Health insurance. The employer pays 1.91% of pay. The employee's contributions are not deducted separately: the Tax Administration builds them into the tax-card withholding rate.

Income tax on salaries

Each employee has a tax card (verokortti) issued by the Tax Administration. It shows a base withholding rate, an additional rate and an annual income limit, set at about 12.5 months' wages including the holiday bonus. The employer withholds at the base rate until its payments in the year exceed the limit, then at the additional rate. Many employers receive the tax card details electronically; otherwise the employee hands the card over. Without a tax card the employer must withhold 60%.

The withholding rate is worked out from the employee's expected income and deductions for the year. It covers the progressive state income tax, the flat municipal tax set by each municipality (7.57% on average in 2026), church tax for members and the health insurance contributions. The 2026 state income tax scale on taxable earned income is:

The public broadcasting tax is 2.50% of income above €15,150, up to €160. The deductions the Tax Administration makes automatically are already reflected in the tax card rate.

The Tax Administration's own 2026 examples show what this means for a wage earner living in Helsinki, aged 17 to 64, a church member with only wage income: a tax rate of 8.5% on €30,000 a year, 14.0% on €40,000, 19.0% on €50,000, 22.5% on €60,000 and 25.0% on €70,000. The 8.19% pension and unemployment contributions come on top.

Minimum wage, working time and mandatory pay

No statutory minimum wage. Finnish legislation does not set a minimum wage. Pay is based on the collective agreement that binds the employer, and an employer not bound by one must still observe at least the sector's generally applicable collective agreement (Employment Contracts Act, chapter 2, section 7). If no agreement applies and no pay was agreed, the employee is owed reasonable normal pay for the work.

Working time and overtime. Regular working time may not exceed 8 hours a day or 40 hours a week. Under section 20 of the Working Time Act, daily overtime is paid at pay plus 50% for the first two hours and pay plus 100% for each further hour, and weekly overtime at pay plus 50%.

Annual holiday. Employees earn 2.5 weekdays of holiday for each full holiday credit month, or 2 weekdays if the employment has lasted less than a year by the end of the holiday credit year, and they keep their pay during the holiday. The Annual Holidays Act does not provide a holiday bonus (lomaraha); whether one is due depends on the collective agreement or the contract.

Pay and payslip. Pay goes to the employee's bank account, in cash only for compelling reasons, and on each payment the employer must give a calculation showing the amount of pay and how it was determined.

Monthly payroll calendar and filings

1. 1Register as an employer in the Tax Administration's Employer Register if you regularly pay wages to two or more employees, to one regular employee plus temporary staff, or to at least six people at the same time. Casual employers do not register but still report every payment.
2. 2Insure the employee for TyEL with a pension insurer and for accidents at work, and arrange statutory occupational health care.
3. 3Report each payment to the Incomes Register with an earnings payment report within 5 days of the payday. If the fifth day falls on a weekend or holiday, the next business day is enough.
4. 4File the employer's separate report with the health insurance contribution by the 5th of the month following the payday month.
5. 5Pay the withholdings and the employer's health insurance contribution in MyTax by the 12th of the month following the payday month. Registered employers that qualify can ask for a quarterly tax period; the Incomes Register deadlines do not change.
6. 6Pay TyEL and unemployment insurance on the invoices from the pension insurer and the Employment Fund.

Worked example: €5,000 a month

An employee aged 35 earns €5,000 gross a month (€60,000 a year), lives in Helsinki, belongs to the Evangelical Lutheran Church and has no other income. We use the Tax Administration's 2026 example rate of 22.5% for €60,000 a year; the real rate is the one on the employee's own tax card. The employer's annual payroll is below €2,509,500.

Accident insurance, and group life insurance where the collective agreement requires it, add a premium set by the insurer. Any holiday bonus due under the collective agreement is an extra cost.

Common mistakes

1. 1Using the 2025 contribution rates: the employee's unemployment contribution is 0.89% in 2026 and the employer's 0.31% or 1.23%, and employees aged 53 to 62 no longer pay a higher TyEL rate.
2. 2Paying without a valid tax card instead of withholding 60%, or ignoring the additional rate once the income limit is reached.
3. 3Missing the 5-day Incomes Register deadline, which applies to every payday regardless of the tax period.
4. 4Forgetting the employer's separate report for the health insurance contribution.
5. 5Assuming there is no pay floor: the generally applicable collective agreement sets minimum pay and can add its own overtime rules and a holiday bonus.
6. 6Leaving out accident insurance when budgeting a hire.

How Clientlly helps

Clientlly does not ship a built-in payroll profile for Finland. An administrator enters the Finnish payroll rates once in the payroll tax settings: the income-tax bands, the personal allowance, the employee and employer contribution rates and the minimum wage. Clientlly then calculates gross to net and the employer contributions and produces payslips. Because Finnish withholding follows each employee's tax card, check the tax amounts against the rate on that card.

Alongside payroll, the human resources module handles leave requests and approvals with a leave calendar and keeps HR documents, and attendance and time tracking records working hours and overtime.