Estonia dividend tax calculator 2026
Estonia taxes distributed profit, not retained profit. On payout the company pays income tax of 22/78 on the net amount — for every €78 paid to the owner, €22 goes to the state. For the recipient the dividend is generally tax-free.
- Shareholder receives
- €10,000.00
- Total cost to the company
- €12,820.51
Basis of the calculation
Estonia taxes profit only when it is distributed — retained profit is untaxed. The tax is calculated on the net dividend at 22/78, so a €10,000 payout costs the company roughly €2,820 more.
Rates and thresholds
- Rate on the net dividend
- 22/78, i.e. 28.21%
- Rate on gross profit
- 22%
- Reduced 14/86 rate
- abolished from 2025
Why is the rate 22/78 rather than simply 22%?
Both describe the same tax from different ends. From gross profit the rate is 22%: of a hundred euros of profit, 22 go to the state and 78 to the owner. Starting from the net dividend — the amount received — the tax works out at 22/78, about 28.21% of the payout. The calculator shows both views.
Is social tax due on dividends?
No. A dividend is not salary, so no social tax (33%), unemployment insurance or pension contributions apply. That is why owners weigh salary against dividends — though an owner-director paying no salary at all invites the tax authority's attention, since work performed must be paid as salary.
Salary or dividends — which costs less?
On rates alone the dividend is cheaper: 28.21% of net versus labour taxes approaching half of the employer's cost. But salary buys health insurance, pension record and use of the basic exemption (€700/month); a dividend buys none of those. The sensible answer is usually a mix, not either extreme.