Effect of earnings, assets and capital income on the general housing allowance

The general housing allowance is affected by wage income and income paid in addition to the wage, for instance

• fringe benefits (such as housing, car or meals)
• overtime pay
• shift pay
• holiday pay.

A self-employed person’s income also affects the general housing allowance. As a rule, Kela estimates the amount of self-employment income based on each self-employed person’s earned income under the self-employed persons’ (YEL) or farmers’ (MYEL) pension insurance scheme.

Part of the assets of the household affect the amount of housing allowance starting 1 January 2025.

The limit for the amount of assets that is taken into account is EUR 10,000 for single-person households and EUR 20,000 for households of two or more adults. Of the amount that exceeds the limit, 20% is counted as income in the housing allowance.

If the household has assets of EUR 50,000 or more, no housing allowance is paid at all.

Any debts are first deducted from the assets, however.

Example

Pekka lives alone in a rental apartment. Pekka owns shares with a total value of EUR 15,000. Because his household consists of just one person, 20% of the value of assets exceeding EUR 10,000 is added to the income taken into account when calculating the housing allowance.

The amount of income on assets for Pekka is (EUR 15,000 - EUR 10,000) x 20% = EUR 1,000.

In other words, the part of Pekka’s assets that affects the amount of the housing allowance is EUR 1,000 per year, or EUR 83.33 per month. In addition to that, Pekka’s earnings and capital income also affect his housing allowance. 

Assets that affect the general housing allowance

• real estate, not including summer cottage in own use
• shares in a housing company
• deposits
  • However, a deduction of EUR 2,000 for disposable income is made from account deposits. This amount does not affect the general housing allowance. The deduction is personal, which means that it is made from each family member's deposits.
• business and farming assets as well as shares in corporate assets
• forest holdings
• bonds or equivalent
• publicly listed shares and shares in mutual funds
• insurance savings.

However, assets such as shares in an undivided estate or deposits on an ASP (home saver’s bonus) account are not taken into account.

The general housing allowance is also affected by capital income, including

• dividends and interest on deposits
  • Kela counts as income the dividend and interest income of each member of the household if it exceeds EUR 12.02 per month.
  • Dividends paid to an equity savings account count as income even if they are not withdrawn from the equity savings account.
• capital gains
  • Recurring capital gains count as income.
  • Capital loss is not deducted from capital gains.
• rental income, for instance
  • rental income from apartment
  • rental income from business premises
  • income from ground rent

Income from forestry also affects the general housing allowance. The income from forestry is calculated on the basis of the average yield of forest stands. The income from the actual sale of forest holdings is not taken into account.