1. Contract parties
1.1. Service provider: Omapaja Oy (Business ID 2399894-2) (hereinafter Omapaja)
1.2. Service user (hereinafter light entrepreneur)
(1.1-1.2 hereinafter contract parties)
2. Service content
Omapaja provides self-employment and earning support services for light entrepreneur. A light entrepreneur invoices their work through Omapaja’s invoicing service with Omapaja’s business ID. Omapaja carries out the statutory obligations concerning the light entrepreneur’s invoicing, payroll and withholding tax on behalf of the light entrepreneur. Omapaja has acquired a group accident insurance and liability insurance, which cover the work of the light entrepreneur according to the valid insurance terms.
3. Position of a light entrepreneur
Light entrepreneur is a self-employed person operating without their own business ID, who agrees on the terms and prices of their work or service directly with their client. Work is invoiced via Omapaja’s invoicing service with Omapaja’s business ID. For tax purposes, the light entrepreneur is in the position of an employee, which is why they are not accountable for their activities. The light entrepreneur has the right to use an assistant or a substitute in their work.
Omapaja does not act as an employer of the light entrepreneur and no employment relationship arises between Omapaja and the light entrepreneur, because Omapaja does not have, for example, the right to manage or supervise the work or service of the light entrepreneur. Only work performed in the assignment relationship can be invoiced through Omapaja’s invoicing service. The light entrepreneur is responsible for ensuring that there is no employment relationship between the light entrepreneur and the work provider. Collective agreements do not apply to the assignment relationship between the light entrepreneur and the work provider.
In order to maintain their right to full unemployment benefits, the activities invoiced by the light entrepreneur through Omapaja must not be an obstacle to receiving full-time work.
Work invoiced through Omapaja does not accumulate the wage earner’s full unemployment benefit's employment condition. However, a YEL-insured light entrepreneur can join the entrepreneurs' unemployment fund if the conditions are met, and accumulate the full unemployment benefit's employment condition there.
Subscribing to Omapaja invoicing service is free of charge, and the use of the service does not include any fixed monthly fees. Omapaja charges a service fee from the light entrepreneur upon the salary payment.
- The service fee is scaled to four levels: Journeyman (7 %), Smith (6%), Hammerer (5.5%) and Master (5 %).
- New light entrepreneur is at the level of Journeyman and the service fee is 7% of the VAT-exclusive amount of the light entrepreneur’s invoicing
- Once the invoicing of the light entrepreneur rises above 50,000 € (VAT 0%), the light entrepreneur rises to the level of Smith, in which case the service fee is 6% of VAT-exclusive invoicing
- Once the invoicing of the light entrepreneur rises above 150,000 € (VAT 0 %), the light entrepreneur rises to the level of Hammerer, in which case the service fee is 5.5% of VAT-exclusive invoicing
- Once the invoicing of the light entrepreneur rises above 300,000 € (VAT 0%), the light entrepreneur rises to the level of Master, in which case the service fee is 5% of VAT-exclusive invoicing
The calculation of the service fee level takes into account the invoicing of the light entrepreneur for the entire period of operation, and it is not reset annually. Invoices, cash sales and other sales paid by a client are taken into account in calculating the service fee. Internal invoices are not taken into account in calculating the service fee level.
5. Light entrepreneur’s salary formation
Omapaja pays the light entrepreneur compensation for the invoiced work as a salary. The gross salary of the entrepreneur is calculated by deducting the costs associated with the acquisition of income and travel expenses from the VAT-exclusive amount of the invoice. After this, a withholding tax in accordance with the light entrepreneur’s tax card is withheld from the light entrepreneur’s gross salary, after which Omapaja’s service fee and the possible health insurance contribution is withheld from the net salary. The health insurance contribution is determined in accordance with the instructions of the Tax Administration. In 2021, the health insurance contribution will be deducted only from light entrepreneurs subject to YEL insurance according to the Entrepreneur’s Pension Insurance Act, and the amount of the deducted health insurance contribution is 1.53 % of gross salary. Otherwise, no health insurance contribution is deducted from the salary of the light entrepreneur. The service fee and health insurance contributions are deductible in the personal taxation of the entrepreneur.
If the light entrepreneur’s annual earnings exceed the YEL earnings limit (8063.57 € in 2021), and they have been an entrepreneur for over 4 months, they are obliged to take out the entrepreneur’s pension insurance. It is possible to take out the YEL entrepreneur’s pension insurance through Omapaja with a power of an attorney from the pension insurance company Elo. Pension insurance contributions are deductible in the personal taxation of the light entrepreneur.
VAT at the current tax rate is always added to the VAT-exclusive invoice created by the light entrepreneur. The tax rate is determined by the light entrepreneur’s industry. Light entrepreneur cannot apply the VAT exemption for minor activities defined in section 3 of the Value Added Tax Act to their own activities, because they operate under Omapaja Oy’s business ID.
Light entrepreneur may deduct as operating expenses the expenses in accordance with the Tax Administration's instructions, which have been incurred directly in carrying out the work in question (income-generating expenses). Light entrepreneur may also receive part of their income in the form of tax-free expenses in accordance with the instructions of the Tax Administration, which reduces the amount on which taxes are paid. The necessary supporting documents must be submitted to Omapaja no later than before the payment of the salary for the work in question. The light entrepreneur is responsible for the correctness of the expenses reimbursed.
Light entrepreneur must take the above expense into account when agreeing on invoicing for work. The light entrepreneur must determine their own invoicing price so that the gross salary determined after deducting expenses is reasonable in relation to the invoiced work.
Compensation agreed between the work provider and the light entrepreneur for the performance of work or services is a one-time compensation. In addition to the agreed compensation, the light entrepreneur is not entitled to charge other compensation for, for example, overtime, sick leave, business trips or the use of own tools, unless they have been separately agreed in advance.
The salary is paid to the light entrepreneur’s account after the work provider has paid the invoice to Omapaja. Light entrepreneur can choose the desired payday on a monthly basis by notifying Omapaja.
6. Omapaja's liability
Omapaja is responsible for calculating the income and expenses of the light entrepreneur and the salary, paying the salary, withholding taxes and settling the employer's health insurance contribution and VAT, as well as the related notifications to the authorities.
Omapaja has acquired a group accident insurance that covers work-related accidents relative to works invoiced through Omapaja in accordance with the valid insurance terms. The amount insured is 5,000 euros for treatment costs, 25,000 euros for death and 30,000 euros for permanent handicap. In addition, the insurance company pays a daily allowance of 40 euros after the three-day deductible period for a short-term (less than one year) work disability caused by an accident.
Omapaja has acquired a legal protection insurance for the light entrepreneurs and a liability insurance for operations up until 1,000,000 euros. The insurance indemnifies for any personal and material damage to the work provider or third party in accordance with the valid insurance terms and conditions. As a rule, the deductible per damages for light entrepreneurs is 600 euros. Industries covered by liability insurance can be seen in the invoicing system. The insurance does not cover damage caused by unprofessional work.
7. Light entrepreneur’s liability
The light entrepreneur is liable for their own operations and any damage they may cause. Omapaja is not liable for the result of the light entrepreneur’s work and Omapaja is not in a contractual relationship with the work provider. In their work, the light entrepreneur must comply with occupational health and safety regulations and other statutory industry-specific regulations. The light entrepreneur settles any disputes regarding their work performance directly with the client.
If the profession of the light entrepreneur requires official permits, the permits must be submitted to Omapaja for inspection before starting work. The use of the invoicing service is not possible in some licensed industries, so the light entrepreneur should make sure that the invoicing service is suitable by contacting Omapaja.
Ownership, copyright and other rights to trademarks, trade names, product and operating models and inventions developed by the light entrepreneur in their own operations belong to the light entrepreneur.
The contract parties undertake not to disclose confidential information of another third party without the other’s permission
10. Contract validity
The service contract enters into force at the time of acceptance of the service contract and is valid until further notice. The contract parties may terminate the service contract with a 7 day notice. Termination shall not relieve the parties of any obligations arising during the term of this contract.