List of corporate taxes
As to which taxes have to be paid at which rate, this depends on the specific characteristics of the company:
- Income tax
- Value-added tax
- Social tax
- Customs tax and excise duties
- Unemployment insurance premium
- Environmental charges
- Taxes payable in the case of cross-border operations
- Other taxes
Taxation of corporate income
A special feature of corporate income tax in Estonia is the fact that only dividends are taxed. Earnings are not taxed as long as they are reinvested in the company. Income tax must be paid on distributed earnings, expenses and payments not related to enterprise and on gifts, donations, costs of entertaining guests and fringe benefits granted to employees.
Estonian company is always a tax resident in Estonia. Meaning, that its profits are taxed in Estonia once they are distributed to shareholder(s).
However, if company has certain activities or its place of management in other country (countries), then the tax laws of other countries may treat Estonian company as taxable also in their country, according to their local tax rules. For Estonian companies with foreign management or foreign activities, we strongly suggest to consult with local tax authoroties or tax advisors to find out potential tax liabilities in other countries. Estonia has treaties in place with ca 60+ countries for avoidance of double taxation, which can be of your benefit.
Amount of income tax and payment term
The corporate income tax rate in 2019 is 20/80. The taxation period is a calendar month and the income tax declaration must be submitted to the Tax and Customs Board by the 10th of the subsequent month after distribution of dividends or other taxable payouts.