--- title: What you need to know about dividends date: 2019-03-21T08:46:24Z modified: 2025-12-19T11:36:54Z permalink: "https://grow.ee/mida-pead-teadma-dividendidest/" type: post status: publish excerpt: "" wpid: 5841 featured_image: "https://grow.ee/wp-content/uploads/2019/03/Dividends_3.jpg" timestamp: 2025-12-19T11:36:54Z tags: - Taxes - Accounting --- Dividends can be paid by a company from the profits of previous years and only if the annual report has been approved. Therefore, dividends cannot be paid in the first year. The requirement must also be met that the company's assets do not decrease below the limit permitted by law, which is a minimum of 2,500 euros for an OÜ. ### Dividends paid The shareholders decide to pay dividends, and the latter does not yet incur income tax liability. Income tax is paid on dividends after the payment has been made. Since income tax must be paid on dividends the following month, it is important to forward the information to the accountant in a timely manner. ### Dividends received Please note that dividends received must also be declared on an ongoing basis. If your company has received dividends from someone else, they must be declared. Generally, income tax has been withheld from them and the declaration remains rather informative. Therefore, if dividends are paid out by the company, they are generally already tax-free or at a reduced tax rate. ### Declaration and calculation of dividends Since dividends must be declared on the 10th of the month following receipt/payment, it is important to forward this information to the accountant in a timely manner, so that he can declare and pay the corresponding income on time. According to the general rule, the income tax rate in Estonia is 20%, starting from this year, dividend income tax can be withheld at a reduced rate of 14% if dividend payments are made between companies. For more information, you can read Grow Finance accountant Malle Liivat's article [ RahaGeenius ](https://grow.ee/wp-content/uploads/wp-mfa-exports/post/dividendid-ja-nendega-seotud-muudatused-aastal-2018.md).