Grant-holders’ Issues:What are the benefits on working on a grant as opposed to working on a contract?
Working on a grant allows the grant holder a great freedom in their work. A grant is something the researcher has earned with his own merit, and is a personal accomplishment. Grants given by foundations are tax-free to a certain amount. However, while you’re working on a grant, you must remember you are not employed and therefore are not insured by an employer and do not have occupational healthcare etc. Also when working on a grant, you are not accumulating any work history towards unemployment compensation. You’ll find a guide Grant Information for Researchers on FUURT’s website.
If grants are not taxed, how are pensions actually calculated? Does Mela report this to the tax office?
There's detailed information on the Farmers' Social Insurance Institution's (Mela) website.
Do you have to report your grant-related expenses to Mela?
Yes. Grant recipients must, within three months of starting their work, themselves contact Mela to take out insurance and provide Mela with an account of the materials and other expenses caused by working.
What’s the upper limit of a grant when it actually becomes taxed? Is it possible to get back taxes later on? Will tax deductions transfer to other years or to spouse’s taxable income?
Stipends, study grants and other scholarships as well as awards granted by a public entity or the Nordic Council are always free of tax. Grants and awards given by foundations, universities and other non-public entities are taxable income to the extent that the total amount of all grants and awards – including those made by public entities – received by the tax subject during the tax year after deducting professional expenses exceeds the annual amount of the State artist grant, which stands at € 20 309,40 as of 1.3.2017.
Are the Mela pension insurance payments really mandatory? Who checks them, and are there audits on these? Do grant-awarding foundations give info directly to Mela?
Foundations who give out grants do inform Mela about the grants. The payments that are set according to the law governing grant holders pension issues, are mandatory. Mela has a legal right to collect them if they are not paid voluntarily.
Is it possible to have a maternity/paternity leave while working on a grant?
If you are going to be on a maternity leave during your grant, you should always contact the Grant giver and discuss it with them. You can apply for a postponement on your Mela insurance from Mela during your leave after 4 months of working on a grant.
The mother can work during parental leave, in which case Kela’s parental allowance is paid at the minimum rate for the working days. Working on Sundays has no effect on the allowance. The father may not work during his leave, except on Sundays. If the father works during the leave, no parental allowance is paid for the working days.