Taxes in Estonia

  • Value added tax (VAT) 20%
  • Social tax 33%
  • Income tax 21%
  • Corporation income tax on undistributed profits 0%
  • Annual basic exemption (non-taxable amount) 144 EUR/per month
  • Unemployment insurance premium (employee) 2,8% withheld of gross salary
  • Unemployment insurance premium (employer) 1,4% of gross salary
  • Funded pension payment (resident employee) 2% of gross salary

Income Tax Act § 50 (1): A resident company (including a general or limited partnership) shall pay income tax on profit distributed as dividends or other profit distributions upon payment thereof in monetary or non-monetary form. Income tax is not charged on profit distributed by way of a bonus issue.

Read more about income tax in Estonia from Income Tax Act

If your compnay has VAT number then VAT declaration must be submitted and VAT paid latest 20th every month. For example May VAT should be declared 20th of June. It means that the accountatn must receive documents and bank statements latest by 10th that month.

If company makes paiments that are subject to income and or social tax, the tax returns must be submitted and taxes paid latest on 10th every month. It is common in Estonia to pay salaries at the beginning of next month. F.e May salary will be paid in June and declared in July.

Annual reports must be submitted within 6 months following the company fiscal year.