Accounting for your Estonian company

What Estonian bookkeeping covers

Estonian accounting is not a translation of the German kind. The books are kept under Estonian law, filings go electronically to the Estonian authorities, and the deadlines are different. For you as a controller, what matters is that results arrive on time and fit into your figures.

The ongoing work has four parts: bookkeeping from documents and bank, the VAT return, payroll, and the annual report with filing. Each has its own deadline, and each builds on the books for the month.

VAT

Estonian VAT has been 24% since 1 July 2025. The registration threshold is 40,000 EUR. The VAT return (KMD) is due by the 20th of the following month. In plain terms, every month the company tells the Tax Board how much VAT it charged and paid, and settles the difference. We prepare the return from reconciled books and file it. The rules are covered in our Estonia VAT guide.

Payroll

On gross pay the employer pays 33% social tax and 0.8% unemployment insurance, and the employee pays 1.6%. That gives the employer multiplier of 1.338. At 1,000 EUR gross, an employee costs the employer 1,338 EUR. Social tax has a minimum of 292.38 EUR a month. There is also a monthly basic exemption of 700 EUR, which reduces the employee's income tax.

We run payroll every month, file it in Estonia and give you a summary of payroll cost for your planning and group reporting. How an employee is to be treated in relation to Germany, for instance on a secondment or when working in both countries, is a question for your Steuerberater.

The annual report

The annual report is due at the commercial register by 30 June. We prepare it from the books of the financial year, agree it with you and file it electronically. Whether your group reporting needs adjustments to the Estonian figures is for you to settle with your Steuerberater and auditor.

In practice that means the books of the financial year should be closed months before 30 June. We therefore plan the annual report backwards from the deadline and collect open questions on balances, receivables and intra-group items from you early. That leaves you and your auditor time to review before anything is filed.

Bank, documents and reconciliation

The books start with the bank. We post the account movements, match them to documents and reconcile open items. What cannot be matched we ask you about instead of estimating. At month-end we reconcile receivables, payables and intra-group balances, so that the trial balance (the list of all account balances) can be relied on.

Where the company has suppliers or customers abroad, we check that invoices, VAT treatment and reporting fit together. Which treatment is right in a given case, we discuss with you before we file.

What we need from you each month

1. Bank statements for every company account, ideally read-only bank access.
2. Sales and purchase invoices with their documents.
3. Staff changes: starters, leavers, salary changes and absences.
4. New contracts and intra-group services with the German company.
5. Answers to queries on open items within a few days.

Where it usually goes wrong in practice

• Documents are missing for bank transactions, so entries stay open.
• Intra-group invoices do not match between Germany and Estonia, for example in date, amount or currency.
• Staff changes reach us after the payroll run and not before it.
• VAT is reconciled just before the 20th rather than at month-end.

Most of these come down to routine rather than expertise. We therefore ask for documents early and raise queries while the transaction is still fresh. If months are behind, we clean them up first, before the ongoing routine starts.

How the figures reach your Steuerberater

After each month-end your Steuerberater receives a trial balance and the reports in the agreed format. The annual report follows at year end. Chart of accounts, layout and dates are agreed once with them or your accounts team, so the Estonian figures consolidate without rework.

What it costs to run

We quote a fixed price only after looking at the company, because cost follows scope. The main factors are transactions, employees, VAT registration, bank accounts and the state of the books so far. If months are behind, catch-up bookkeeping may be needed first. You get the quote in writing before we begin.