Estonya - emlak vergisi rehberi

Corporate income tax

Estonia has an unconventional tax system whereby profits of resident companies and registered permanent establishments are not taxed until accumulated profits are distributed.  The effective tax rate on profit distributions is 23% for 2006 (previously 24% in 2005). It is scheduled to decrease gradually to 20% by 2009, decreasing by 1% each year.  Tax is payable monthly.

Foreign companies who have not registered a permanent establishment in Estonia will suffer 23 % withholding tax on all rental income receivable in 2006 (previously 24%).  The withholding tax rate is also scheduled to decrease to 20% by 2009.  This tax should be withheld by corporate tenants.  However, when rental income is received from individuals (who are not required to withhold tax), an annual tax return must be submitted in Estonia.

Capital gains

Capital gains realised by an Estonian company or a registered permanent establishment are subject to corporate income tax at the standard rate.

When a non-resident realises a capital gain on the disposal of real estate, it must submit a tax return detailing the gain within one month of disposal.  The gain will be subject to corporate income tax at the standard rate.

Property tax

Land tax is charged annually at 0.1% to 2.5% (depending on location of the land and the use it is put to) on the taxable value of the land as determined in the most recent government assessment.  The assessment can be made annually, as and when the government deems it to be necessary.  The taxable value is determined by the local authorities and is assessed on land value only, i.e. excluding buildings.  The tax is paid in three equal instalments on 15 April, July and October each year.

Property transfer taxes

Stamp duty is charged on the purchase of Estonian real estate at varying rates up to a maximum of 0.04% (depending on the value of the property) on the VAT inclusive purchase price.

The purchase of shares in an Estonian property holding company is subject to a small stamp duty charge (for the changing of information in the Commercial Register).  The purchase of shares in a private limited company is also subject to a notary fee.  The purchase of shares in a non-resident company (or unit trust) owning Estonian property is not subject to tax in Estonia.

VAT

VAT registration in Estonia is compulsory for both Estonian companies and non-residents if Estonian taxable supplies exceed EEK 250,000 in the calendar year, unless the supplies are “reverse chargeable” by the recipient.  This means that the VAT is self-assessed by the recipient of the services or goods and therefore no VAT liability arises for the foreign service provider.

Standard rated supplies are subject to VAT at 18%.  Real estate transactions are generally exempt from VAT, with the option to tax.  However, the supply of buildings before their first use and the supply of plots of land for development are not exempt.  It is not possible to opt to tax the supply of residential buildings.


The above is for general information purposes only. It is not intended to be comprehensive or to provide any specific tax advice.