Corporate income tax on distributions
Also called: distributed profit tax, Estonian corporate income tax
Estonia's company income tax, charged when profit is paid out, for example as dividends, rather than when it is earned.
In Estonia, a company pays no income tax on profit it earns and keeps. Corporate income tax is due when profit leaves the company. That mainly means dividends, but it also covers fringe benefits, gifts, donations, entertainment costs, expenses unrelated to the business and hidden distributions of profit.
The rate is 22% (source: emta.ee, checked 3 Oct 2026) of the gross distribution. Because the tax is added on top of the net amount paid out, it works out as 22/78 (source: emta.ee, checked 3 Oct 2026) of the net amount. The company pays it and declares it on the TSD return, due on the 10th (source: emta.ee, checked 3 Oct 2026) of the month after the payout.
Keeping profit in the company postpones Estonian tax, but it does not answer tax questions elsewhere. Your home country may have controlled foreign company rules. Read How does Estonia’s corporate income tax work? and try the payout calculator.
General information only, not tax or legal advice. This site is not affiliated with, endorsed by or operated by the Republic of Estonia or the e-Residency programme.
Guides that use this term
Related terms: OÜ, Board member fee, Controlled foreign company. All terms.
Sources
- Income and social taxes, Estonian Tax and Customs Board (EMTA). Checked 3 Oct 2026.
- Tax liabilities of companies established by e-residents, Estonian Tax and Customs Board (EMTA). Checked 3 Oct 2026.
- Income Tax Act, Riigi Teataja (Estonian State Gazette). Checked 3 Oct 2026.
- emta.ee, for: Corporate income tax rate on distributed profit (share of the gross distribution).
- emta.ee, for: Day of the following month by which the income and social tax return (TSD) is due.
Figures last checked: 3 October 2026. Each figure links to its source; see all sources and dates.
Last reviewed .