What You Need to Know about Personal Taxes in Estonia in 2025
Estonia is widely known for its digital innovation, ease of doing business, and simple tax system. But when it comes to personal taxes, many residents — both Estonian citizens and international professionals living here — still have questions.
Here’s your straightforward guide to personal taxes in Estonia and how to stay compliant while making the most of what the system offers.
The Basics: Who Pays Personal Income Tax in Estonia?
If you’re considered a tax resident of Estonia, you’re liable to pay income tax on your worldwide income. Non-residents, on the other hand, pay tax only on Estonian-sourced income.
You’re considered a tax resident if:
- Your place of residence is in Estonia, or
- You spend 183 days or more in Estonia over 12 consecutive months.
Flat Personal Income Tax Rate
Estonia applies a flat income tax rate of 22% — one of the simplest systems in Europe. No progressive brackets. No complex calculations. Just one rate, across all earned income (salary, freelance income, rental income, dividends, etc.).
Tax-Free Allowance in 2025
In 2025, the basic exemption (or tax-free income) continues at €654 per month, or €7,848 per year. However, this allowance gradually decreases for individuals earning over €14,400 annually and disappears entirely for those earning more than €25,200.
Filing Your Tax Return
Tax season in Estonia runs from 15 February to 30 April each year. The good news? Most residents find the process quick and seamless thanks to the e-Tax system — Estonia’s digital portal for filing and paying taxes.
The system pre-fills much of the data for you, especially if you’re employed by an Estonian company. However, it’s wise to double-check everything — especially if you have:
- Foreign income;
- Freelance or gig earnings;
- Crypto transactions;
- Rental or capital gains income;
Foreign Income & Expats
Estonia has double taxation treaties with over 60 countries, meaning you generally won’t pay tax twice on the same income.
Still, if you’re working remotely for a foreign employer or receiving income from abroad, proper documentation is essential. Legalabi can help you navigate these waters and make sure you’re not overpaying or risking non-compliance.
Need Help with Personal Tax Matters?
Whether you’re an Estonian resident, a digital nomad, or a new expat, understanding your tax responsibilities is crucial.
At Legalabi, we offer tailored tax consultations to help individuals:
- File returns accurately;
- Optimise their tax position;
- Understand foreign income rules;
- Handle communication with the Tax and Customs Board (MTA).
Let us guide you through the tax maze — the Estonian way: digital, efficient, and transparent.
Contact us today for a tax consultation.