• Public Limited Company (AS, aktsiaseltsi)
• Private Limited Company (OÜ, osaühing)
• General Partnership (TÜ, täisühing)
• Limited Partnership (UÜ, usaldusühing)
• Commercial association (tulundusühistu)

The general value-added tax rate is 22%. Accommodation and accommodation with breakfast VAT is 13 % and medicines, newspapers and books VAT is 9 %.

A business must register for VAT when its annual turnover exceeds 40,000 euros. It can voluntarily apply for VAT registration earlier. The tax authorities may remove a business from the VAT register if the business submits zero reports for several months or has no turnover.

The unemployment insurance contribution is 2.4%, of which the employee’s share is 1.6%. Social taxes total 33%, with 20% allocated to social security contributions and 13% to health insurance contributions.

The personal income tax is 22%. The tax-free portion of the salary is progressive. (A written application from the employee is required to use the tax-free portion). The tax-free amount is 7,848 euros per year if the annual income is below 14,400 euros. If the annual income is between 14,400 and 25,200 euros, the tax-free amount is calculated according to the formula: 7,848 – 7,848 / 10,800 * (income amount – 14,400). If the annual income exceeds 25,200 euros, the tax-free amount is 0 euros. The total annual income includes not only salary income but also dividend, interest, and rental income, income from the sale of real estate and securities and also taxable income received from abroad.

The corporate income tax is 0% if the profit is left in the company for investments. For dividends and other taxable expenses and payments, the corporate income tax is 22%. The amount of the tax is calculated from the net amount of the payment using a factor of 22/78. For example, if the dividend is 100,000 euros, the tax is 22/78 x 100,000, which equals 28,205 euros.

Transfer pricing refers to pricing in transactions between companies within a group or related parties. Internationally, it is considered that transactions between such companies should be conducted at arm’s length. This means that the same pricing and other terms should be followed as if the transactions were conducted between independent companies. Tax authorities in different countries pay special attention to the pricing used in cross-border transactions. Therefore, taxpayers should be prepared to justify the pricing they use if necessary, even if they are not required to have formal transfer pricing documentation.

For foreign recipients, the dividends may either be tax-free or subject to a lower tax rate, depending on the recipient’s country of residence and applicable international tax agreements.

The specific tax liability details are determined by international tax treaties and local tax laws.

Estonian law does not recognize a CEO. However, a company may have a CEO (in addition to the board of directors), but the CEO does not have the right to represent the company in its relations with third parties based solely on the law. The CEO cannot be registered in the commercial register either.

Foreign E-residency refers to the E-resident card used in Estonia. The E-resident card was first issued to foreigners in December 2014. It allows access to Estonia’s electronic systems and the digital signing of documents. With the card, it is possible to establish a company, manage banking and tax matters, make changes to the commercial register, and log into various electronic services. The card does not confer Estonian citizenship, tax liability, or residency rights, and it cannot be used as a travel or physical identification document. E-residency can be applied for easily online or at a police station in Estonia. In addition to Estonian police stations, the card can be picked up at an Estonian representation abroad, such as the Estonian embassies. The application for the card can be made online by applying for e-residency.