A company's profit does not mean the business owner has cash
In business, it is quite easy to end up in a situation where, according to the accounts, the company is making a profit, but the bank account does not reflect it. The figures show a good result, but there seems to be no cash. At first glance this may seem contradictory, but in fact profit and cash are two completely different things. Profit shows the company's financial result, i.e. whether income has exceeded expenses. Cash flow […]
Minimum wage increase 2026: what does it mean for employers and employees?
As of 1 April 2026, the minimum wage in Estonia has increased. For full-time work, the minimum monthly wage is 946 euros and the minimum hourly wage is 5,67 euros. 2026 is a special year, because instead of the usual January, the change only took effect in April. The reason is that employers and trade unions failed to reach an agreement on the new minimum wage last year, and an agreement was only reached in February of this year […]
Daily allowance for foreign business trips: what do employers, employees and accountants need to know?
Foreign business trips are a routine part of many companies' operations. However, mistakes are very often made in accounting for them – especially regarding daily allowances. In this post, I explain simply and clearly: when a trip qualifies as a business trip; how much tax-free daily allowance can be paid; what must definitely be monitored? What is the daily allowance for foreign business trips? The daily allowance for a foreign business trip is money paid to an employee to help cover everyday expenses related to staying abroad (for example: […]
Tax changes 2026 - what is worth knowing?
The year 2026 brings some changes in the field of taxation, but the overall picture is encouraging: the system becomes simpler, the tax hump disappears and the situation of recipients of several benefits improves significantly. While at the beginning of 2025 there was still talk of very ambitious reforms, some of which were due to enter into force in 2026, it is now clear that several of the initial plans will be dropped or postponed. At the same time, it is precisely […]
Share capital deposit and its refund - what should every new entrepreneur know?
Many new entrepreneurs have asked: “I made the share capital contribution - so where is that money now?” If you founded your company via the expedited procedure in the e-Business Register, you should know that the share capital contribution is paid into the Ministry of Finance's current account, the so-called court deposit account. But the main question is: how does that money reach your company's account? Let's take a closer look: What is a share capital deposit? Under the Commercial Code § […]
Another tax increase? A new wave from 01.07.2025!
Another tax increase? A new wave from 01.07.2025! From 1 July, several important changes come into force that affect companies' taxation, invoicing, the tax exception for long-term contracts and day-to-day operations. Here is an overview of the main changes. Most importantly – the VAT rate rises to 24 per cent (22% → 24%). All standard-rate transactions must be taxed at 24% from 1 July. There are no transitional measures – the new rate applies to all transactions […]
Digital services and their taxation
Digital services and their taxation Digital services are a rapidly developing field that has changed the way the entire economy operates, particularly the growth of the digital economy and the development of technology. Thanks to the internet and global electronic networks, the provision of services is increasingly automated and managed remotely. Given that companies provide services in Estonia, in the European Union and also outside the European Union, it is important […]
Accounting for small businesses: tips and tricks worth knowing
Accounting for small businesses: tips and tricks worth knowing As a small business owner, you have to deal with many things – from finding clients to developing products or services. But one thing you cannot avoid is accounting. It may seem complicated, but if you know the basics and use the right tools, it becomes much easier. Here are the important tips that will help you manage your accounting better […]
Taxation of corporate profits and declaring the security tax
Taxation of corporate profits and declaring the security tax Next, we will look at what is being said about the taxation of profits, the security tax return and advance payments. When reading this post, please bear in mind that this is, for now, a planned system. We will update the post later if necessary. Profit is the difference between the income and expenses of an accounting entity during the reporting period. Until now, only profit withdrawn from the company has been taxed in Estonia, but from 01.01.2026 […]
Tax changes 2025–2026
Tax changes 2025–2026 The Riigikogu has been working diligently to bring us a large number of tax changes. These concern VAT, income tax, motor vehicle tax as well as new taxes such as the security tax. In addition, there are changes to land tax, excise duties and several tax incentives. Below we look at what is changing and how these changes affect businesses, private individuals and organisations. 2025 tax rates: Corporate income tax 22% (22/78) Personal income tax 22% Tax-free income […]