--- title: FAQ date: 2022-03-03T12:07:40Z modified: 2025-10-07T12:22:53Z permalink: "https://grow.ee/kkk/" type: page status: publish excerpt: "" wpid: 7232 timestamp: 2025-10-07T12:22:53Z tags: [] --- ![](https://grow.ee/wp-content/uploads/2024/05/Digitaalne-raamatupidamine-Grow-2.webp) ### frequently asked questions ### Our services [ What is the minimum monthly fee for the accounting service offered by Grow Finance and what is included in the monthly fee? ](#accordion-item-what-is-the-minimum-monthly-fee-for-accounting-services-provided-by-grow-finance-and-what-is-the-monthly-fee?)The minimum monthly fee for Grow Finance's accounting service is 99 euros per month plus VAT. For more information about the service packages, click [here](https://grow.ee/wp-content/uploads/wp-mfa-exports/page/raamatupidamisteenuse-paketid.md). [ I would like to receive accounting consultations. Who should I contact to learn more about the services offered by Grow Finance? ](#accordion-item-I would like to receive accounting consultations. Who should I contact to learn more about the services offered by Grow Finance?)All questions can be sent to the email address **paring@grow.ee**. We will respond to you as soon as possible, usually within 24 hours on weekdays. If you wish, you can fill out a more detailed request [**here**](https://grow.ee/wp-content/uploads/wp-mfa-exports/page/kusi-pakkumist.md). [ If I need tax advice – does Grow Finance offer this service? ](#accordion-item-kui-vajan-maksunõstasmit-–-kas-grow-finance-pakub-seda-teenust?)Yes, Grow Finance offers tax advice, the advice fee is **150€/h** for domestic Estonian issues and **175€/h** for international issues. VAT is added to the prices. The minimum fee is 1 hour. You can submit a request for a consultation [**here**](https://grow.ee/wp-content/uploads/wp-mfa-exports/page/maksunoustamine.md). [ How does Grow Finance's accounting service work? ](#accordion-item-how-grow-finance's-accounting-service-works?)The accounting service is paperless. This means that all accounting documents can be submitted as e-invoices, PDF invoices or image files. Grow Finance uses modern digital solutions to manage all purchase invoices, receipts and expense reports. [ Can I do my own accounting? ](#accordion-item-can-I-do-my-own-accounting-service-works?)Yes, it is possible, but you must have knowledge of accounting and Estonian legislation. Grow Finance strongly recommends that you have experienced accountants do your accounting and tax reporting so that you can fully focus on your business. [ Can the accounting service be managed entirely online? ](#accordion-item-can-I-do-my-own-accounting-service-works-be-managed-entirely-online?)Yes, if you wish, it is possible to access all accounting remotely. There is no direct need to meet to order a service and cooperate, although we definitely prefer a physical meeting for closer cooperation. ### VAT information [ When do I have to register as a VAT payer? ](#accordion-item-millal-pean-registreerima-end-väibemaksuotsalkesks?)In Estonia, the mandatory turnover for VAT registration from the beginning of the calendar year is 40,000 euros (excluding sales of fixed assets), which only applies to turnover sold to customers in Estonia and the European Union. If your company's annual taxable turnover is less than 40,000 euros or your customers are located outside the EU, then you are not obliged to register as a VAT payer and you do not have to calculate or pay VAT for services provided in Estonia that would otherwise be taxable. Voluntary registration before reaching the registration threshold is also possible. In this case, you must submit a corresponding application to the Estonian Tax and Customs Board. There is no registration obligation if the company's entire turnover is tax-free or you only export goods from the EU to third countries. However, the registration obligation may also arise in connection with acquisitions from a foreign country: if goods are purchased in an amount exceeding 10,000 euros or so-called intangible services are received. Detailed information about VAT can be found on the Estonian Tax and Customs Board website or contact our [**tax advisor**](https://grow.ee/wp-content/uploads/wp-mfa-exports/page/maksunoustamine.md). [ My products are sold, stored and produced in another EU country by third parties. Should a company account for Estonian VAT with an Estonian VAT number? ](#accordion-item-my-products-are-sold,-stored-and-produced-in-another-country-by-third-parties.-should-a-company-account-for-Estonian-VAT-with-an-Estonian-VAT-number?)When selling goods, VAT is declared in Estonia only if the goods are shipped out of Estonia. If your goods are never located in Estonia, the purchase/sale takes place elsewhere and the transaction is not subject to VAT in Estonia. For example, if an Estonian company ships goods from Spain to Germany, the sales turnover does not arise in Estonia, but in Germany, according to Estonian VAT rules. When trading goods, you must register for VAT in the country where your goods are physically located. [ How do I pay VAT if I start e-commerce in the European Union? ](#accordion-item-how-do-I-pay-VAT-if-I-start-e-commerce-in-the-European-Union?)If an Estonian company sells goods or provides services to a private individual in another EU member state in an amount exceeding 10,000 euros per year throughout the EU, VAT must be paid according to the rate of that country. There are two options for this: – The seller registers as a VAT payer in that other country and also pays VAT there – The seller registers as a user of the OSS special scheme in Estonia. This allows him to declare all sales made to private individuals in the EU with a single declaration to the Estonian Tax and Customs Board, which forwards the VAT paid to the relevant countries. [ How can I register as a VAT payer in Estonia? ](#accordion-item-how-to-register-as-a-VAT-taxpayer-in-Estonia?)The entire process is described on the Estonian Tax and Customs Board website „[Registration as a VAT payer](https://www.emta.ee/ariklient/maksud-ja-tasumine/kaibemaks/kaibemaksukohustuslasena-registerimine)“. To begin with, you must submit an application for VAT registration online. If the applicant is not a member of the company's board, then permission must be obtained from a member of the board for „Submitting applications for VAT registration (KMKR)“. This also applies if you want your accountant to do it for you. As your cooperation partner, we can do all the necessary activities ourselves. [ How can I get a refund of overpaid VAT? ](#accordion-item-how-to-return-overpaid-VAT?)If the VAT calculated on the VAT return submitted to the Estonian Tax and Customs Board is less than the VAT paid on the purchase of goods and services, the overpaid VAT will be refunded to the company. When the tax deadline arrives, the MTA automatically settles the company's financial obligations based on the declaration with its advance payments. To receive the overpaid amount into its bank account, the company submits a refund application to the MTA in the e-environment. The MTA may ask the company for additional evidence to refund the tax amount. The refund will take place within up to 60 days. [ Can Grow Finance help me submit monthly VAT reports to the Estonian Tax and Customs Board? ](#accordion-item-can-grow-finance-help-me-submit-monthly-VAT-tax-and-customs-board-reports?)Yes, Grow Finance can prepare and submit mandatory tax returns for companies that have signed a cooperation agreement with us. ### Taxation [ Does a company have to submit tax returns every month in Estonia? ](#accordion-item-can-a-company-have-to-submit-tax-declarations-every-month-in-Estonia?)A person liable for VAT must submit a VAT return every month. If there is no turnover or reverse charge acquisitions in the reporting month, a zero return is submitted. An entrepreneur who has employees must submit a declaration of income and social tax, unemployment insurance contributions and mandatory funded pension contributions (form TSD) every month. If the company does not have contract employees, the TSD form must be submitted only in those months when profits have been distributed as dividends or other profit distributions have been made, fringe benefits have been given to employees or expenses not directly related to the company's business activities have been made (gifts, fines, etc.). The company is obliged to submit its annual report to the Commercial Register within 6 months after the end of the financial year. [ Difference between tax residency and general residency ](#accordion-item-difference-between-tax-residency-and-general-residency)General residency, or citizenship, applies to natural persons and is determined by the person's passport, while tax residency is determined based on the tax laws of different countries. Simply put, tax residency is the place where a person pays their taxes. A natural person is considered resident if they are present in the country for at least 183 days during 12 consecutive calendar months. From a company's perspective, tax residency is basically the country where it is incorporated. Tax residency or e-residency is not citizenship. [ Can I pay myself a salary as a board member? ](#accordion-item-can-I-pay-myself-as-a-board-member-salary?)It is important to know in which country you are a tax resident in order to pay taxes in that country. If you live and work in Estonia, you are a tax resident here. There are two options for paying salaries to board members: first, to register you as an employee with an employment contract, which requires payment of the minimum wage in Estonia. This does not exclude receiving dividends or board member fees. The second option is a board member contract, where there is no official minimum wage or unemployment insurance contribution, which means there is no unemployment insurance coverage. Dividends cannot replace the official salary, as they are not subject to labor taxes. 1. The first option is to register you as an employee with an employment contract. In this case, the minimum wage must be paid in Estonia. This does not exclude receiving dividends or board member fees. In this case, payment must be made if the employee works in Estonia. The applicable taxes are 20% income tax, 33% social tax, 1.6% + 0.8% unemployment insurance contribution and 2% mandatory funded pension contribution. 2. Another option is a management board member contract. In this case, there is no official minimum wage, nor is there any unemployment insurance contribution, so there is no protection against unemployment. A management board member receives Estonian social security only if the salary is at least the official minimum wage established in Estonia and it is paid here (Estonian tax resident). It is important to understand that dividends cannot be used as a substitute for official salary, as dividends are not taxed with labor taxes. If persons employed under an employment contract of an Estonian company are not Estonian residents and live and work abroad, then taxes on their salary are not declared or paid in Estonia. Taxation takes place in the country where the work takes place. The salary received by a management board member who lives and works abroad is taxed in Estonia. If the person presents an A1 certificate, social tax is paid in the country that issued the certificate. In Estonia, there may be a tax risk in connection with the remuneration received under the management board member contract. [ How and when can dividends be paid to management board members? ](#accordion-item-kuidas-ja-milal-mõib-dividde-maksta-juhatuses-meiletele?)Before dividends can be paid, the share capital according to the articles of association must be paid in and registered in the Estonian Commercial Register. Dividends are taxed at 20% income tax. In the fourth year after the start of dividend payments, a lower 14% rate is also available. The amount of dividends with the lower 14/86 tax rate is based on the average taxed dividend and equity distribution of the previous three years. If dividends with the lower rate are distributed to a private individual, an additional 7% income tax will apply. Also, dividends can only be paid based on retained earnings (previous year's profit), which is based on the annual report submitted for the previous year. Payment of dividends from the current year's profit is not permitted. Dividend tax reporting is submitted together with the wage and social tax return by the 10th of the month following the payment. The deadline is also the deadline for paying income tax. ### Additional info for foreign companies [ How and when can dividends be paid to board members? ](#accordion-item-how-and-when-can-dividends-be-paid-to-board-members?)Before paying any dividends, share capital must be paid in and registered with the Estonian Business Register. Dividends are taxed with 22% of Income Tax (calculated on net amount: 22/78). Also, dividends can only be paid from retained earnings (previous year's profits) based on the Annual Report submitted for the previous year. It is not allowed to pay dividends on current year's profits. Tax reporting for dividends is submitted with wages and social tax declaration for the 10th date of the following month after the payment. The due date is also the term for the income tax payment. [ How can I pay share capital into the company? ](#accordion-item-how-can-i-pay-share-capital-into-the-company?)The minimum share capital for an OÜ is €0.01 per shareholder. You can choose to contribute more for credibility or investor confidence. Firstly, you need to make a payment from your personal account to the company's bank account with a credit or payment institution in the EEA (European Economic Area) with description "Share capital contribution". Founders confirm the capital payment digitally in the Estonian Business Register. A bank notice is required for monetary contributions over €50,000. Secondly, an application to the Estonian Business Register needs to be submitted digitally to change the company's details. Thirdly, an application to the Estonian Business Register to change statutes (includes shareholder's decision) needs to be submitted. Grow Finance can process the second and third step for you for a service fee of €100 plus VAT. [Can I take a loan as a private person from my Estonian company? ](#accordion-item-can-i-take-loan-as-a-private-person-from-my-estonian-company?)Estonian Commercial Code Act § 159 and 281 set out that Private Limited Companies and Limited Companies are not allowed to lend money to their shareholders whose share is bigger than 5% of share capital in Private Limited Company or bigger than 1% in Limited Company. Similar restriction for loan applies to company's parent company's shareholder or other members. Also, it is not allowed to give a loan to a company's member of the board or procurator. There is an exception where subsidiary is allowed to give loan to parent company or parent company's shareholder or board member if this does not damage financial position of the company or interests of the creditor. [ In which country do I have to pay the taxes when I´ma resident of another EU country, but my company is registered in Estonia? ](#accordion-item-in-which-country-do-i-have-to-pay-the-taxes-when-i´ma-resident-of-another-eu-country,-but-my-company-is-registered-in-estonia?)Labor taxes on salaries are paid in the country where the work is performed. The income tax on board members' fees is paid to the country where the company is registered, while other labor taxes are paid to the country where the person's social insurance is held (usually this is the person's country of residence, and it is the same across all EU countries). If the person moves to Estonia, labor taxes (income tax and social security contributions) are paid in Estonia. [ Is it true that in Estonia companies do not have to pay income tax on their profits? ](#accordion-item-is-it-true-that-in-estonia-companies-do-not-have-to-pay-income-tax-on-their-profits?)In Estonia, companies do not pay corporate income tax on annual profits. Tax is only charged when profits are distributed, for example as dividends. Profits that are reinvested in the business remain exempt from tax. Corporate income tax also applies to certain expenses that are not related to business activities, such as fringe benefits, gifts, donations, and transfer pricing adjustments. Because profits are not taxed annually, companies do not need to file an annual corporate tax return. Instead, income tax is calculated and declared monthly, but only if there is a taxable distribution. [ What if I have a Permanent Establishment in Estonia? ](#accordion-item-what-if-i-have-a-permanent-establishment-in-estonia?)If your business activities in Estonia are significant and ongoing, you may create a Permanent Establishment (PE) under Estonian tax law. A PE is generally a fixed place of business (such as an office, branch, or construction site) or a situation where a person in Estonia regularly concludes contracts on behalf of your company. Once a PE exists, it is treated as a taxpayer in Estonia. This means: The PE must register with the Estonian Tax and Customs Board. It must keep separate accounting records and prepare financial statements for its Estonian operations. Income tax is charged on profits or assets transferred from the PE to the foreign head office, as well as on non-business expenses (eg, fringe benefits, gifts). If profits remain reinvested in the PE, no income tax is due. Tax returns (Form TSD) are filed monthly, but only when taxable transfers occur. [ How is double taxation avoided? ](#accordion-item-how-is-double-taxation-avoided?)Double taxation occurs when two countries tax the same income. To prevent this, Estonia has signed Double Taxation Agreements (DTAs) with over 60 countries. These treaties: Allocate taxing rights between Estonia and the other country (eg, which country can tax dividends, interest, royalties, or business profits). Provide relief methods, such as tax exemptions or credits, so you don't pay tax twice on the same income. Include rules for resolving dual residency and mechanisms for dispute resolution. To benefit from a DTA, you must usually provide a certificate of tax residency from your home country to the Estonian Tax and Customs Board.