Effects of income on earnings-related daily allowance
Income subject to withholding tax, such as wages, salary, incentives, holiday bonuses and holiday compensations, is taken into consideration when calculating the amount of earnings-related daily allowance. If we use a tax decision to make adjustments based on business income, we take earned income from business activities into consideration. Capital income is not taken into consideration.
The allowance is not affected by the basic exempt amount, which is EUR 300 per month. This means that we will pay you full earnings-related daily allowance if your income does not exceed EUR 300 per month. If your income exceeds EUR 300, we take into consideration half of the amount in excess of EUR 300. If you apply for daily allowance in periods of four calendar weeks the exempt amount is EUR 279. The exempt amount is always applied to each individual application period.
Income is allocated to the application period during which the income is paid. Application periods must be aligned with wage payment periods. If the wage payment period is a calendar month, earnings-related daily allowance is applied in periods of one calendar month and the exempt amount is EUR 300. The unemployment fund receives income information from the Incomes Register, but we may need to request supplementation.
You must report your working hours in your application, even if you are not paid until the following month. For example, if your part-time employment begins in January and your first wages are paid in February, report the hours you have worked in January in your application for January.
For example, if your income subject to withholding tax is EUR 800, the income reduces the amount of your monthly earnings-related daily allowance as follows:
EUR 800 (wages) - EUR 300 = EUR 500
EUR 500 x 50 % = EUR 250
EUR 250 / 21,5 = EUR 11,63
Wages of EUR 800 reduce the amount of earnings-related daily allowance by EUR 11.63 per day and approximately EUR 250 per month. The reduction has been calculated taking using the exempt amount of EUR 300.
Upper limit of adjusted daily allowance
There is an upper limit to the amount of adjusted daily allowance. Wages paid by your employer and adjusted daily allowance paid by the unemployment fund may not be more than 100 percent, in total, of the pay on which your earnings-related daily allowance is based. For example, if the wages on which your earnings-related daily allowance is based are EUR 2,500 per month and you receive EUR 1,500 for part-time work, you will be paid approximately EUR 1,000 per month as adjusted daily allowance. If there was no upper limit to adjusted daily allowance, we would pay EUR 1,090 per month on average. The daily allowance is reduced by approximately EUR 90 due to the upper limit.
You can calculate the estimated amount of your adjusted daily allowance in the electronic services of the unemployment fund.
Conversion of income when adjusted daily allowance is paid for a short period
A special adjustment period is applied if your application period includes a period for which we cannot pay adjusted daily allowance. This means that when calculating your income, it is converted to correspond to monthly income. This is necessary in situations such as when a waiting period is applied, or you start full-time employment lasting more than two weeks and your adjusted application period is shorter than a month or four weeks for this reason.
You are employed part-time and receive EUR 1,000 per month in wages. Your payday is the 15th of each month. On 23 March 2020, you start full-time employment lasting more than two weeks. We pay you adjusted daily allowance for the period 1 – 22 March 2020. Because the daily allowance is paid for a period of less than a month, we will convert the wages of EUR 1,000 for the period. The calculation is performed by dividing EUR 1,000 by the number of days included in the payment period of 1 March to 22 March 2020. The number of days is 15 because daily allowance is paid for five days per week. The amount is then multiplied by 21.5 and the adjusted income comes to EUR 1,433 (EUR 1,000 / 15 x 21.5 = EUR 1,433).
Due to the emergency law, the special adjustment period is not applied between 11 May and 30 December 2022.
Adjusted daily allowance is paid for five days per week, including workdays. You must be registered as a jobseeker with the TE Office and look for full-time employment.
The maximum period accumulates slower on adjusted daily allowance
The accumulation of days towards the maximum payment period is slower when on adjusted daily allowance. The adjusted daily allowance (gross) paid for a period of a month or four weeks is divided by the member’s full earnings-related daily allowance, which gives us the number of days that count towards the maximum payment period. For example, if you receive EUR 1,000 (gross) as adjusted daily allowance for a period of one month and your full earnings-related daily allowance is EUR 70 per day, the number of days that count towards the maximum payment period is 14 days for the month in question.