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 2023 to 2024 as well as national minimum wage rates since 1996.

Tax rates

2024

  • The rate of withheld income tax is 20%.
  • The amount of basic exemption depends on a person’s income (up to 654 euros per month and up to 7,848 euros per year). In order for the basic exemption to be calculated, the person must submit a written application to the employer or the person making the payment.
    More information on the calculation of basic exemption of a resident and non-resident.
  • Basic exemption at pensionable age does not depend on a person’s income (up to 776 euros per month and up to 9,312 euros per year). In order for the basic exemption to be calculated, the person at pensionable age does not need to submit an application to the Social Insurance Board or the Funded Pension Registry. The Social Insurance Board calculates the basic exemption automatically and transfers the unused balance of basic exemption to the Funded Pension Registry.
    More information: Basic exemption at pensionable age
  • Expenses made for improving employees’ health to the extent of 100 euros per employee in a quarter are exempt from tax.
    More information: Health and sport expenses
  • The rate of corporate income tax applicable to dividends is 20/80. The rate of corporate income tax on regularly payable dividends is 14/86 and the rate of income tax additionally withheld from dividends paid to natural persons is 7%.
  • The rate of social tax is 33 per cent. The monthly rate of the minimum social tax obligation is 725 euros (instead of 654 euros in force in 2023), i.e. the minimum obligation of social tax is 239.25 euros per month.
  • The unemployment insurance premium rates are 1.6% for the employee and 0.8% for the employer (the same as in 2023).
    The obligation to withhold employee’s unemployment insurance premium (1.6%) ends on the last day of the month in which the employee reaches pensionable age or is granted early retirement or flexible old-age pension. The employer shall continue to pay unemployment insurance premium on the wages paid to an employee at pensionable age or employee who has been granted an early retirement pension or flexible old-age pension at the rate established for the employer (0.8%).
  • The funded pension contribution rate is 2%.
    The obligation to withhold the contribution to funded pension may change 3 times a year: 1 January, 1 May and 1 September. This is regardless of whether a person leaves the second pillar, suspends contributions to the second pillar, retires from the second pillar or joins the second pillar. Information about the obligation to withhold funded pension contributions can be obtained through the Funded Pension Registry’s subscription query by means of a simple or mass query using personal identification codes.

    We recommend that accountants check the obligation to withhold contributions to employees’ funded pension in December, April and August.

    As of 1 January 2024, persons who have joined the II pillar will have the opportunity to increase their 2% funded pension contribution rate to 4% or 6% if they wish. For this purpose, a corresponding application must be submitted to the registrar of the pension register or account administrator (from 1 January 2024 to 30 November 2024) and the new payment rate will apply from 1 January 2025.
    More information: Amendment to the funded pension contribution rate as of 1 January 2025

  • Upon making payments for December 2023, it should be borne in mind that taxation is cash-based, i.e. if the December wages are paid out in January, the taxes and payments must be calculated in the 2024 rates and declared in the tax return (form TSD) submitted for January (the submission deadline is 10 February 2024). However, if the December wages are paid in December 2023, the 2023 rates will have to be applied for the calculation/withholding of taxes and payments, and the taxes and payments will have to be declared in the tax return (form TSD) submitted for December 2023 (the submission deadline is 10 January 2024).

2025

  • The rate of withheld income tax is 22%.
  • A resident natural person has the right to deduct the basic exemption of 700 euros per month from their taxable income, regardless of the person's income.
    The amendment establishes a uniform basic exemption of 700 euros per month or 8,400 euros per year from 2025, except for persons of pensionable age, whose basic exemption is equal to the average old-age pension. The basic exemption extends to all residents of Estonia and the European Economic Area (residents of European Union Member States, Norway, Iceland, Liechtenstein) regardless of the amount of income they have earned.
  • The rate of corporate income tax applicable to dividends is 22/78.
    The tax calculation of regularly distributed dividends, i.e. the lower tax rate of 14/86, and the 7% rate of withheld income tax on untaxed dividends for natural persons can no longer be used.
    However, in a situation where a company has paid dividends at a lower rate to another company, the exemption method applies when these are paid further to the parent company or to a shareholder who is a legal person, and 7% income tax must be withheld when paid further to a shareholder who is a natural person.
  • From 1 January 2025, the mandatory funded pension contribution rate is 2%, 4% or 6%, depending on a person's application to the registrar. If a person has not made an application to use a higher rate, the default contribution rate is 2%.
    More information: Amendment to the funded pension contribution rate as of 1 January 2025
  • The rate of withheld income tax is 20%.
  • The amount of basic exemption depends on a person’s income (up to 654 euros per month and up to 7,848 euros per year). In order for the basic exemption to be calculated, the person must submit a written application to the employer or the person making the payment.
    More information on the calculation of basic exemption of a resident and non-resident.
  • Basic exemption at pensionable age does not depend on a person’s income (up to 704 euros per month and up to 8,448 euros per year). In order for the basic exemption to be calculated, the person at pensionable age does not need to submit an application to the Social Insurance Board or the Funded Pension Registry. The Social Insurance Board calculates the basic exemption automatically and transfers the unused balance of basic exemption to the Funded Pension Registry. More information: Basic exemption at pensionable age
  • Expenses made for improving employees’ health to the extent of 100 euros per employee in a quarter are exempt from tax. More information: Health and sport expenses
  • The rate of corporate income tax applicable to dividends is 20/80. The rate of corporate income tax on regularly payable dividends is 14/86 and the rate of income tax additionally withheld from dividends paid to natural persons is 7%.
  • The rate of social tax is 33 per cent. The monthly rate of the minimum social tax obligation is 654 euros (instead of 584 euros in force in 2022), i.e. the minimum obligation of social tax is 215.82 euros per month.
  • The unemployment insurance premium rates are 1.6% for the employee and 0.8% for the employer (the same as in 2022).
    The obligation to withhold employee’s unemployment insurance premium (1.6%) ends on the last day of the month in which the employee reaches pensionable age or is granted early retirement or flexible old-age pension. The employer shall continue to pay unemployment insurance premium on the wages paid to an employee at pensionable age or employee who has been granted an early retirement pension or flexible old-age pension at the rate established for the employer (0.8%).
  • The funded pension contribution rate is 2%.
    The obligation to withhold the contribution to funded pension may change 3 times a year: 1 January, 1 May and 1 September. This is regardless of whether a person leaves the second pillar, suspends contributions to the second pillar, retires from the second pillar or joins the second pillar. Information about the obligation to withhold funded pension contributions can be obtained through the Funded Pension Registry’s subscription query by means of a simple or mass query using personal identification codes.

    • applications submitted in the period 1 April 2022 – 31 July 2022 suspend the obligation to contribute on 1 January 2023, this information has been included in the subscription query of the Funded Pension Registry as of 1 December 2022;
    • applications submitted in the period 1 August 2022 – 30 November 2022 suspend the obligation to contribute on 1 May 2023, this information has been included in the subscription query of the Funded Pension Registry as of 1 April 2023;
    • applications submitted in the period 1 December 2022 – 31 March 2023 suspend the obligation to contribute on 1 September 2023, this information will be added on 1 August 2023.

NB! As the applicant has the right to withdraw the application no later than one month before the suspension of the obligation to contribute, the Funded Pension Registry cannot receive information about the obligation to pay contributions earlier than 1 month before the due date of suspension. Therefore, we recommend that accountants check the obligation to withhold contributions to employees’ funded pension in December, April and August.

  • As of 1 January 2023, the withholding of 2% of the funded pension contribution will start for employees who have reached the age of 18 in 2022 (if they have not submitted an application for suspension of contributions in 2022).
  • Upon making payments for December 2022, it should be borne in mind that taxation is cash-based, i.e. if the December wages are paid out in January, the taxes and payments must be calculated in the 2023 rates and declared in the tax return (form TSD) submitted for January (the submission deadline is 10 February 2023). However, if the December wages are paid in December 2022, the 2022 rates have to be applied for the calculation/withholding of taxes and payments, and the taxes and payments have to be declared in the tax return (form TSD) submitted for December 2022 (the submission deadline is 10 January 2023).

National minimum wage rates

Since 1 January 2024 the minimum hourly wage rate is 4,86 euros per hour. The minimum monthly wage in the case of full-time working time is 820 euros.
 

From Minimum wage per hour Minimum monthly wage in the case of full-time work Basis
01.01.2024 4,86 euros 820 euros Government of the Republic Regulation No 113 of 08.12.2023
01.01.2023 4,30 euros 725 euros Government of the Republic Regulation No 124 of 09.12.2022 
01.01.2022 3,86 euros 654 euros Government of the Republic Regulation No 116 of 09.12.2021
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
From Minimum wage per hour Minimum monthly wage in the case of full-time work Basis
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: 08.12.2023

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