The term light entrepreneur is not used in the Finnish labour legislation – it is just a marketing term coined by invoicing service companies. This causes a lot of confusion. Despite the absence of legal recognition, the position of light entrepreneurs has been made easier and clearer in recent years. For example, the Tax Administration has published instructions for light entrepreneurs. We can also expect changes in legislation in the coming years.
But, for now, are light entrepreneurs outside legal protection? There is still variation in how different laws determine light entrepreneurs’ position; whether they are seen as employees or entrepreneurs. For instance, the pension legislation and taxation can treat light entrepreneurs differently.
In labour and social insurance legislation, light entrepreneurs are treated as entrepreneurs if they conduct paid work without being in an employment relationship as it is determined in the Employment Contracts Act. According to Finnish law, a pension insurance must be taken after exceeding a certain annual income limit (8 261,71 euros in 2022). You can get a pension insurance, for example, through an invoicing service company.
If you are simultaneously an unemployed jobseeker entitled to unemployment benefits and a light entrepreneur, there is a chance that the authorities determine that you are a full-time entrepreneur. This would result in you not being entitled to general unemployment benefits. You are deemed to employ yourself full-time as an entrepreneur or in a similar manner if your work activities prevent you from accepting full-time work (37–40 h/week).
From the point of view of unemployment benefits, entrepreneurship is divided to full-time and part-time entrepreneurship. Part-time entrepreneurs are entitled to adjusted unemployment benefit. For light entrepreneurs receiving unemployment benefits, it is important to ask the employment services for precise guidelines on when they are considered to be full-time entrepreneurs.