Payroll taxation in Estonia


Employee's payroll calculation

Gross salary

Tax exempt income

Unemployment tax paid by the employer 1.6%

Taxable income

Income tax 20%

Social security tax 33%

Unemployment tax paid by the employee 0.8%

Employee to receive

Total taxes

Total cost for the employer

1 000 EUR

170 EUR

16 EUR (1.6% x 1 000)

814 EUR

162,8 EUR

330 EUR

8 EUR (0.8% x 1 000)

821,2 EUR (1 000 – 162,8 – 16)

516,8 EUR (162,8 + 16 + 330 + 8)

1 338 EUR (1 000 + 330 + 8)



From the total cost 1338 EUR - 61% (821,2 EUR) is received by the employee and 39% (516,8 EUR) is paid in taxes.