Salary for Insurance Purposes
While being posted abroad, the insurance contributions that you and your employer pay are based on your salary for insurance purposes. This salary is also the basis for the earnings-related pension you will accrue during your period of posting. In addition, this salary will form the basis of, among other things, the parental and sickness allowance that you may receive.
Your salary for insurance purposes is:
- the salary that would we paid in Finland for the work you do, or
- the salary that would otherwise correspond to the work in question.
When agreeing on a posting abroad, you and your employer together define your salary for insurance purposes. Your employer will notify its insurance company of the amount you have agreed on.
When you define your salary for insurance purposes together with your employer, you have to follow certain rules. Remember to enter the amount of your salary for insurance purposes into your contract of posting.
Work done abroad often requires special knowledge or skills, or it may include a greater amount of responsibility than work done in Finland. The working hours may also be considerably higher than in Finland. You should take these factors into account when you determine your salary for insurance purposes. If the work done abroad includes fringe benefits or bonuses that would be part of the salary paid for corresponding work done in Finland, you must take these into account, as well.
The rules on the salary for insurance purposes apply to any work that is to be insured under the Employees Pensions Act in Finland that you do in any foreign country.
Pension insurance companies and the Finnish Centre for Pensions offer more detailed information on how to determine your salary for insurance purposes. In case of an accident, your accident insurance company can offer more information. The tax administration offers more information on social security and health insurance contributions.
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