Tax rates

On this page you will find the rates of income tax, social tax, contribution to mandatory funded pension and unemployment insurance premium applicable from 2017-2021 as well as national minimum wage rates since 1996.

Tax rates

  • Income of the year 2021 – 20%
  • Income of the year 2020 – 20%
  • Income of the year 2019 – 20%
  • Income of the year 2018 – 20%
  • Income of the year 2017 – 20%

Period of taxation for natural persons is a calendar year.

Tax-free amount as basic exemption applies to all kinds of income together. In order to the basic exemption to be applied by the payer (to be deducted from taxable payment before withholding income tax from payment to resident natural person), application has to be submitted to only one payer at once by the resident natural person recipient. The amount of basic exemption to be deducted may be chosen by recipient, if smaller than the amount allowed by law. The latter is recommended if a person is not sure of the total income of the year to be earned, as some additional amount to be earned later during the year may reduce the maximum amount allowed to be deducted. Too much deduction during a year may result in obligation to pay additional income tax amount according to the annual tax return next year. Please be informed that in case of total amount of all income exceeding 25 200 EUR in a year, including dividends (exempted from income tax in Estonia) and income from abroad, there is no right to the deduction of basic exemption to be applied at all.

In Estonia, annual basic exemption (non-taxable amount) per year is:

  • Income of the year 2020 
    up to 500 EUR in a month and
    up to 6000 EUR in the year, but decreasing depending on the total income amount.
    If total amount of all income is 25 200 EUR in a year or more, there is no right to basic exemption at all.
  • Income of the year 2019
    up to 500 EUR in a month and
    up to 6000 EUR in the year, but decreasing depending on the total income amount.
    If total amount of all income is 25 200 EUR in a year or more, there is no right to basic exemption at all.
  • Income of the year 2018 
    up to 500 EUR in a month and
    up to 6000 EUR in the year, but decreasing depending on the total income amount.
    If total amount of all income is 25 200 EUR in a year or more, there is no right to basic exemption at all.
  • Income of the year 2017 – 2160 EUR
  • Distribution in the year 2021 – 20/80
  • Distribution in the year 2020 – 20/80
  • Distribution in the year 2019 – 20/80
  • Distribution up to the taxable average amount of 3 previous years - 14/86
  • Distribution in the year 2018 – 20/80
  • Distribution in the year 2017 – 20/80

In 2020 and in 2021, an unemployment insurance premium to be withheld is 1,6% of the gross salary of an employee.
In addition to this, employers pay the unemployment insurance premium at a rate of 0,8% of the amount of gross salaries monthly.

In case of recipient who has become in the age of old page pension, unemployment insurance premium (1,6%) will not be withheld any more, although the part of the employer (0,8%) is still payable.

Period Rate
From Until Employee Employer
01.01.2015 31.12.2021 1,6 0,8
01.01.2013 31.12.2014 2 1
01.08.2009 31.12.2012 2 1

From 2012, a rate of a funded pension payment is 2% of the gross salary of a resident employee.

Not all persons have joined the funded pension pillar. In order to get to know, if the recipient is the one who has joined, to be sure the funded pension payment has to be withheld, the payer has the opportunity to test either by entering the persons ID-code or by Mass query here: https://www.pensionikeskus.ee/en/accounting/ii-pillar/subscription-mass-query. Please be informed that funded pension payment is not to be withheld from payment made to a non-resident, but the query above does not take the tax residency into account upon issuing the result.

The same address has to be used in order to get to know, if the end date of the obligation to withhold funded pension payment has reached in case of elderly persons, who have already started to get payments out of the pension fund. In case the funded pension payments have started from the fund, for example, in June 2018, the funded pension payment into the fund will continue until December 2018. Thus, the withholding of the funded pension payment will not end just because of the old age of the recipient, but because of the taking payments out.

From 2014 until 2017, a rate of funded pension payment withheld might be 3%, if the person has submitted such application.

In 2011, a rate of a funded pension payment depended on the employee´s decision in 2010. If an employee had decided to continue making payments in 2010, funded pension payments were withheld at a rate of 2% in 2011. In all other cases, funded pension payments were withheld at a rate of 1% of the gross salary of the resident employee in 2011.

From 1 January 2010 until 31 December 2010, a funded pension payment was withheld only if an employee had submitted an application for continuation of making payments in 2010.

Funded pension payments were not withheld from payments made from 1 June 2009 until 31 December 2009.

You can find further information about the Estonian system of pension payments on the website of Estonian Funded Pension Registry

More information on the website of the Ministry of Finance: Restructuring of the second pillar of the funded pension

Social tax is paid by employer in full and a general rate is 33% in 2020 and 2021 of the gross payment.

There is always a minimum obligation for social tax to be paid, in 2020, it is 178.20 euros (monthly), and in 2021, it is 192.72 euros (monthly), even if there were no payments for salaried work for each employee.

In Estonia, there is a cash-based calculation of taxes. If payment of wages for December is paid out in January, the tax rates applicable in 2021 will be used. If December wages are paid out in December, the tax rates of 2020 are applicable.

National minimum wage rates

Since 1 January 2020 the minimum hourly wage rate is 3,48 euros per hour. The minimum monthly wage in the case of full-time working time is 584 euros.
 

From Minimum wage per hour Minimum monthly wage in the case of full-time work Basis
01.01.2021 3,48 euros 584 euros Government of the Republic Regulation No 115 of 19.12.2019
01.01.2020 3,48 euros 584 euros Government of the Republic Regulation No 115 of 19.12.2019
01.01.2019 3,21 euros 540 euros Government of the Republic Regulation No 117 of 13.12.2018
01.01.2018 2,97 euros 500 euros Government of the Republic Regulation No 189 of 21.12.2017
01.01.2017 2,78 euros 470 euros Government of the Republic Regulation No 139 of 18.12.2015
01.01.2016 2,54 euros 430 euros Government of the Republic Regulation No 139 of 18.12.2015
01.01.2015 2,34 euros 390 euros Government of the Republic Regulation No 166 of 28.11.2013
01.01.2014 2,13 euros 355 euros Government of the Republic Regulation No 166 of 28.11.2013
01.01.2013 1,90 euros 320 euros Government of the Republic Regulation No 6 of 10.01.2013
01.01.2012 1,80 euros 290 euros Government of the Republic Regulation No 169 of 22.12.2011
01.01.2011 1,73 euros 278,02 euros Government of the Republic Regulation No 118 of 23.08.2010 § 81
01.01.2008 27 kroons 4350 kroons Government of the Republic Regulation No 90 of 11 June 2009
Government of the Republic Regulation No 254 of 20 December 2007
01.01.2007 21 kroons 50 cents 3600 kroons Government of the Republic Regulation No 273 of 21 December 2006
01.01.2006 17 kroons 80 cents 3000 kroons Government of the Republic Regulation No 328 of 22 December 2005
01.01.2005 15 kroons 90 cents 2690 kroons Government of the Republic Regulation No 374 of 23 December 2004
01.01.2004 14 kroons 60 cents 2480 kroons Government of the Republic Regulation No 323 of 18 December 2003
01.01.2003 12 kroons 90 cents 2160 kroons Government of the Republic Regulation No 366 of 3 December 2002
01.01.2002 10 kroons 95 cents 1850 kroons Government of the Republic Regulation No 396 of 18 December 2001
01.01.2001 9 kroons 40 cents 1600 kroons Government of the Republic Regulation No 428 of 19 December 2000
01.01.2000 8 kroons 25 cents 1400 kroons Government of the Republic Regulation No 360 of 23 November 1999
01.01.1999 7 kroons 35 cents 1250 kroons Government of the Republic Regulation No 270 of 8 December 1998
01.01.1998 6 kroons 50 cents 1100 kroons Government of the Republic Regulation No 245 of 18 December 1997
01.02.1997 5 kroons 845 kroons Government of the Republic Regulation No 52 of 6 March 1997
01.01.1996 4 kroons 680 kroons Government of the Republic Regulation No 14 of 16 January 1996

Last updated: 01.07.2021

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