Tulumaksu

Tulumaksu is the term used for personal income tax in Estonia. It is levied on the income of resident individuals and, in certain cases, on non-resident individuals with Estonian-source income. The tax is administered by the Estonian Tax and Customs Board (Maksu- ja Tolliamet) and forms a central part of the country’s fiscal system.

Tax base and rates: Tulumaksu applies to wages, salaries, business income, pensions and other earnings. Estonia has historically pursued a relatively simple system with a general rate on most income, while some types of income may be taxed differently or exempt. The law also provides for allowances and credits that reduce the amount of tax payable.

Collection and compliance: For employment income, tulumaksu is typically withheld at the source by employers and remitted to the state. Taxpayers with other or additional income may be required to file an annual tax return, and adjustments can be made during the year through advance payments or changes to withholding.

Policy and context: Tulumaksu is designed to be a predictable part of Estonia’s tax framework and is adjusted through periodic legislation. The system aims to balance simplicity with the ability to fund public services, while maintaining competitiveness in the wider Baltic and European context.