The Ministry of Finance has announced modifications to the regulations concerning Estonian CIT. On September 16, 2025, a draft bill amending the PIT and CIT regulations was presented. It appears that for companies applying Estonian CIT, the chosen direction is primarily to increase the tax burden. However, there are also solutions that may resolve existing…
The Ministry of Finance has published draft amendments to the Family Foundation Act, which are to come into force on January 1, 2026. Key changes concerning family foundations Taxation of the sale of assets within 36 months of acquisitionThe foundation will pay 19% CIT on income from the sale of property donated by the…
The modern world of finance is dominated by liquidity management. Companies, especially those belonging to international capital groups, focus on centralization in order to effectively manage cash surpluses and deficits. Cash pooling, a system that enables cash flow management within a group, is becoming not only a popular but also a key tool in this…
The data presented in the Ministry of Finance’s response to a parliamentary question[1] is a warning sign for entrepreneurs that the correct application of Estonian CIT rules may be more challenging than many of them had anticipated. The information presented shows that the tax authorities’ practice of verifying lump sum settlements is extremely restrictive. In…
The tax Guidelines published by the Ministry of Finance concerning the application of the so-called beneficial owner clause for withholding tax purposes (hereinafter: Guidelines) are intended to clarify the rules for applying this clause in the context of the withholding tax collection obligation. One of the issues that has raised doubts in the past was…
Since 2021, it has been possible to conduct business activity in the form of a simple joint-stock company (PSA). The PSA was intended to address the challenges of the modern economy – no barriers to entry, simplified profit distribution and faster liquidation, in short – the ideal legal form for start-ups. However, entrepreneurs still approach…
For many entrepreneurs, Estonian CIT means an opportunity for simplified settlements and greater financial liquidity, but at the same time – a number of conditions to be met. One of them is the prohibition of combining Estonian CIT with the privileges resulting from the decision on support within the Polish Investment Zone (PSI). The latest…
The tax explanations concerning the application of the beneficial owner (BO) clause significantly clarify and, we hope, will facilitate the application of the look-through approach (LTA). The application of the LTA may prove crucial for international capital groups where WHT-taxable receivables are transferred in a payment chain between several related entities. What is the LTA…
The latest explanations issued by the Ministry of Finance on 3 July 2025 regarding withholding tax (hereinafter: the WHT Explanations) clarifies that an entity may be recognised as the beneficial owner of a payment even if it relies on the so-called shared personal and asset substance, i.e. the personnel or infrastructure of other companies within…
On 1 August 2025, the Head of the National Revenue Administration issued a protective opinion (ref. DKP16.8082.1.2025), which is of significant importance for companies planning to switch to Estonian CIT after undergoing reorganisation. In the case in question, the authority found that the redemption and sale of shares leading to the elimination of an investment…