Tax Guide

Estonia corporate taxes

Estonia taxes company profit only when it is distributed: retained and reinvested profit is taxed at 0%, and distributions are taxed at 22%. VAT is 24% and personal income tax a flat 22% with a €700/month tax-free allowance. Almost everything is filed online through e-MTA and the e-Business Register.

Currency EUR (€)Tax year Calendar yearEU member stateLast reviewed 2026-07-12
22%
Corporate income tax
0% on retained profit · 22% on distribution
24%
VAT standard rate
Reduced: 13% and 9%
22%
PIT on salary
Flat · €700/month tax-free
33%
Social tax (employer)
Min. base €886/month (2026)
0%
Dividend WHT
Taxed at company level only

Company forms & registration

Companies register in the e-Business Register (fully online, often in a day); tax matters run through the Tax and Customs Board’s e-MTA portal.

Main legal formsOÜ (private LLC), AS (public LLC), FIE (sole proprietor)[6][17]OÜ is the default choice; it can be formed and run entirely online, including via e-Residency.
Minimum share capital — OÜ€0.01 (minimum abolished 2023)[6][17]The former €2,500 minimum was abolished. If capital is under €2,500, shareholders are personally liable up to the shortfall in a bankruptcy. AS: €25,000.
Registers a new employer meetse-Business Register (incorporation, UBO) → e-MTA (taxes, VAT) → employment register (TÖR) before an employee starts work[17][16]

Other statutory requirements

Obligations beyond filing a tax return that every operating company must satisfy.

Board member salary — not mandatoryNo deemed-salary rule; a board member need not draw a salary[7][13]Unlike Latvia and Lithuania, Estonia does not impute a minimum wage to an unpaid board member. But if a board-member fee is paid, it carries 33% social tax and 22% income tax, wherever the member is resident.
Beneficial ownersUBO data in the Business Register; updates within 30 days[17]Declared at incorporation, confirmed with each annual report. Sanctions up to €32,000 for a legal person.
Contact personRequired if the management board is located abroad[17]Only qualified providers (notary, advocate, auditor, licensed service provider) may act; the appointment is time-limited.
Document retention7 years[5]Accounting source documents and records, from the end of the financial year.

Corporate income tax (tulumaks)

Estonia’s hallmark: profit is untaxed while it stays in the company. Income tax arises only on distribution, and is declared monthly on form TSD.

Retained profit0%[1][7]No tax while profit is retained or reinvested.
Distributed profit22%[1][8]Tax is 22% of the gross distribution; because the taxable base is grossed up, that works out to about 28.2% of the net amount paid out. The former reduced 14% rate and 7% dividend withholding were abolished from 2025 — one uniform rate now applies.
Fringe benefits & non-business costsTaxed at 22%[1][7]Fringe benefits, gifts, entertainment and expenses unrelated to business are taxed like distributions.
Return & paymentForm TSD, monthly by the 10th[9]Distributions and other taxable corporate items are declared and paid by the 10th of the following month.

Withholding taxes & dividends

Dividends to non-residents0%[1][8]No withholding — profit is already taxed at company level on distribution.
Interest to non-residentsGenerally 0%[1]
Royalties to non-residents10%[1]Reduced or eliminated under tax treaties and the EU Interest & Royalties Directive.
Salaries, directors’ & service fees22%[1][7]Withheld on payments to non-resident individuals; directors’ fees for an Estonian company are always taxable in Estonia.
Dividends to resident individualsNo further personal tax[8]Already taxed at company level at 22%; the old 7% top-up on the reduced-rate regime is gone.

VAT (käibemaks)

Standard rate24%[2][10]Raised from 22% on 2025-07-01.
Reduced rate — 13%Hotel & accommodation services[2][10]
Reduced rate — 9%Books & periodicals (print and electronic), listed medicines[2][10]0% applies to exports and intra-EU supplies.
Registration threshold€40,000 taxable turnover per year[2][10]Register with e-MTA within 3 business days of crossing the threshold.
VAT returnForm KMD, monthly by the 20th[10]Payment due the same day. The EU sales list (VD) is filed by the 20th.

Payroll: income & social tax

The employer withholds income tax and the employee’s pension/unemployment contributions, adds social tax and employer unemployment insurance, and files form TSD monthly.

Income tax (tulumaks)22% flat[1][11]The planned rise to 24% was cancelled — the rate stays at 22% in 2026.
Basic exemption€700/month (€8,400/year)[12]From 2026 the exemption is a flat amount for everyone and no longer shrinks as income rises (the “tax hump” is abolished).
Social tax (employer)33%[3][13]Paid on top of gross salary. In 2026 the minimum monthly base is €886, so the minimum liability is €292.38/month.
Unemployment insurance1.6% employee + 0.8% employer[13]
Funded pension (II pillar)2% / 4% / 6% employee[13]Mandatory for residents born after 1982; the employee chooses the rate, and 2% of the employer’s social tax is directed to the account.
Minimum wage€886/month; €946 from April 2026[13]
ReportingForm TSD monthly by the 10th[9]Covers income tax, social tax, unemployment insurance and funded-pension contributions.

Other taxes companies meet

Land tax0.1%–1.0% (residential) up to 2.0% (other) of land value[4][14]Municipal, on land value only — Estonia has no tax on buildings. From 2026 each municipality sets its own annual-increase cap (10–100%).
Motor vehicle taxAnnual tax + one-off registration fee[15][19]In force since 2025 on every registered vehicle; annual tax to EMTA (pay ≥half by Jun 15, rest by Dec 15), registration fee to the Transport Administration.
Excise dutiesAlcohol, tobacco, fuel, electricity, packaging[7]Alcohol and tobacco rates rose +10% from 2026-01-01; fuel and electricity excise rises from 2026-05-01.

Accounting & financial statements

Annual report filingTo the e-Business Register within 6 months of year end[5][18]June 30 for calendar-year companies; must be filed even with no activity. Late filing can be fined without warning and ultimately lead to deletion.
Audit / review thresholdsAudit if 2 of 3: revenue €5m, assets €2.5m, 50 employees[5]A lighter review is required at lower thresholds (revenue €2m, assets €1m, 24 employees). Thresholds rose +25% from FY 2024.
E-invoicingA buyer may require machine-readable e-invoices[5]Since 2025 a registered e-invoice recipient can demand structured e-invoices; no general domestic B2B mandate yet.
Document retention7 years[5]

Forms & filings

Every recurring return and report a typical company deals with, what triggers it, and where it goes. Registration-time and one-off filings are marked “per event”.

FormWhat it isWho filesFrequencyDeadlineFiled with
TSDIncome & social tax return (payroll + distributions)[9]Employers and companies making distributionsmonthly10th of the following monthEMTAe-MTA
KMDVAT return[10]VAT-registered personsmonthly20th of the following monthEMTAe-MTA
VDEU sales list[10]Suppliers making intra-EU suppliesmonthly20th of the following monthEMTAe-MTA
TÖREmployment registration[16]All employersper eventBefore the employee starts workEMTAe-MTA
UBOBeneficial owner data[17]All companiesper eventAt incorporation; updates within 30 dayse-Business Registere-Business Register
Annual reportAnnual report[5][18]All companiesannualWithin 6 months of year end (Jun 30)e-Business Registere-Business Register
Motor vehicle taxMotor vehicle tax[15]Owners of registered vehiclesannual≥half by Jun 15, rest by Dec 15EMTAe-MTA
Land taxLand tax[4][14]Landownersannual≤€100 by Mar 31; else ≥50% by Mar 31, rest by Oct 1EMTAe-MTA

Compliance calendar

The same filings grouped by rhythm — what recurs when.

monthly
  • TSD10th of the following month
  • KMD20th of the following month
  • VD20th of the following month
annual
  • Annual reportWithin 6 months of year end (Jun 30)
  • Motor vehicle tax≥half by Jun 15, rest by Dec 15
  • Land tax≤€100 by Mar 31; else ≥50% by Mar 31, rest by Oct 1
per event
  • TÖRBefore the employee starts work
  • UBOAt incorporation; updates within 30 days

Sources

Numbered references cited throughout this profile. Laws link to consolidated texts in the official register.

  1. Income Tax Act (Tulumaksuseadus), consolidated English textRiigi Teataja — State Gazette · law
  2. Value-Added Tax Act (Käibemaksuseadus), consolidated English textRiigi Teataja — State Gazette · law
  3. Social Tax Act (Sotsiaalmaksuseadus), consolidated English textRiigi Teataja — State Gazette · law
  4. Local Taxes Act / Land Tax Act, consolidated English textRiigi Teataja — State Gazette · law
  5. Accounting Act (Raamatupidamise seadus), consolidated English textRiigi Teataja — State Gazette · law
  6. Commercial Code (Äriseadustik), consolidated English textRiigi Teataja — State Gazette · law
  7. Income and social taxes — guidanceEMTA (Tax and Customs Board) · authority
  8. Taxation of dividendsEMTA (Tax and Customs Board) · authority
  9. Submission of declaration form TSDEMTA (Tax and Customs Board) · authority
  10. Value added tax — guidanceEMTA (Tax and Customs Board) · authority
  11. Tax ratesEMTA (Tax and Customs Board) · authority
  12. Calculation of basic exemptionEMTA (Tax and Customs Board) · authority
  13. Social taxEMTA (Tax and Customs Board) · authority
  14. Land taxEMTA (Tax and Customs Board) · authority
  15. Motor vehicle tax — payment dates 2026EMTA (Tax and Customs Board) · authority
  16. Employment registration (TÖR)EMTA (Tax and Customs Board) · authority
  17. e-Business RegisterCentre of Registers and Information Systems (RIK) · register
  18. Annual report — filingCentre of Registers and Information Systems (RIK) · register
  19. Motor vehicle tax & registration feeTransport Administration · authority