In the context of unemployment security, ‘entrepreneurship’ means all forms of work other than employment.
Whether or not your work is classed as entrepreneurship does not depend on ownership or your position in the business. Working and invoicing for your work through a cooperative society therefore also counts as entrepreneurship for the purposes of unemployment security.
From the point of view of unemployment security, you can be running a business either part-time or full-time. If you run a business part-time, you may be entitled to benefits from your unemployment fund; full-time entrepreneurs are ineligible for benefits. Your benefits will need to be adjusted to account for your income from part-time entrepreneurship. We usually check your income from your latest personal tax assessment.
If you apply for benefits from your unemployment fund, the TE Office will need to make an assessment as to whether yours is a full-time or a part-time business and give a statement to your unemployment fund. Please let the TE Office know if
- you or someone in your family runs a business
- you or someone in your family owns a farm or a forest estate
- you work on a commission-only basis
- you work and invoice for your work through a cooperative society or
- you receive publishing royalties or intellectual property remunerations.
If necessary, you can ask the TE Office to explain the grounds on which they determine whether you are classed as an entrepreneur from the perspective of unemployment security and whether you are running your business full-time or part-time.
If you start a business while unemployed, the TE Office will not make its assessment as to the part-time or full-time nature of your business until after the first four months. It is nevertheless important that you tell the TE Office and your unemployment fund about starting a business as soon as possible.
Who is an entrepreneur?
From the point of view of unemployment security, you can be classed as an entrepreneur in the following circumstances:
You have a self-employed person’s pension or a farmer’s pension due to being
- self-employed (sole trader),
- a farmer,
- a partner in a general partnership, or
- a partner in a limited partnership.
You are an executive in a limited company and hold
- at least 15% of the shares yourself, or
- at least 30% of the shares together with your family.
You work for a limited company and hold
- at least 50% of the shares yourself, or
- at least 50% of the shares together with your family.
You work without an employment contract
- through, for example, a cooperative society, or
- on a commission-only basis.
If the TE Office concludes that your business counts as part-time self-employment, your unemployment fund can pay you benefits. In such circumstances, your allowance will be adjusted according to your business income similarly to other income.
We usually check your business income from your latest personal tax assessment. If you have only just started your business and have not yet completed a tax return, we will base our assessment of your income on your accounts.
If you work and invoice for your work through a collective society or if your work is not based on an employment contract, we base our assessment of your income on your payslips.
‘Short-term entrepreneurship’ means self-employment for a period not exceeding two weeks. You can be classed as a short-term entrepreneur if, for example, you work and invoice for your work through a cooperative society or work on a range of commissions without having an employment contract.
If you only run a business on a short-term basis, the TE Office will not need to give a statement. Your unemployment fund can continue to pay you benefits, but your allowance will be adjusted according to your business income similarly to other income. Make sure to let your unemployment fund know about your business as soon as possible and remember to enclose evidence of your business income with your application.
Working in a family business
If you work for a business owned by a member of your family without having any ownership in or control over the business yourself, you are classed as an employee for the purposes of unemployment security. Until 1 July 2019, family members with no ownership in the family business could also be considered entrepreneurs.
‘Family member’ means a person’s
- spouse or common-law partner,
- parents and grandparents living in the same household, and
- children and grandchildren living in the same household.
When it comes to satisfying the employment requirement, the rules are different for persons who work in a family business than for other employees. If you work for a business owned by a member of your family, you will need to satisfy all of the following criteria to satisfy the employment requirement:
- You have been a member of an unemployment fund for at least 12 months
- You have had no ownership in the business for at least 12 months
- You have worked for your family member’s business for at least 52 qualifying calendar weeks in a 28-month period
Work done in a family business and work done for another employer cannot be combined to satisfy the employment requirement.
Starting a business while unemployed
If you start a business while unemployed, the TE Office will not make its assessment as to the part-time or full-time nature of your business until after the first four months. You will therefore qualify for an earnings-related allowance for the first four months regardless of having a business. However, your earnings-related allowance will be adjusted according to your business income similarly to other income.
Please let the TE Office know as soon as possible if you start a business. Once you have been running your business for four months, the TE Office will examine your circumstances and determine whether you are a part-time or a full-time entrepreneur. If your business is deemed to be a part-time business, you can continue to receive an earnings-related allowance. If you are deemed to be running your business full-time, your earnings-related allowance payments will end.
Entrepreneurs as members of an unemployment fund
Unemployment Fund Aaria is a wage-earners’ unemployment fund. If you are a full-time entrepreneur, you cannot be a member of a wage-earners’ unemployment fund. Full-time entrepreneurs can protect themselves against unemployment by joining the Entrepreneur Fund.
Running a business part-time is not an obstacle to joining or belonging to a wage-earners’ unemployment fund.
Family members of business owners can join a wage-earners’ unemployment fund as long as they have no ownership in the business themselves.
You can find more information about entrepreneurs as members of an unemployment fund under Membership -> Information for entrepreneurs.