Accounting services in Pärnu

What does a construction company need from its accountant?

Above all, costs tracked per project, so you can see which jobs make money and which do not.

Subcontractor invoices, materials and machine hire are booked against the site they belong to. If a job starts to run over budget, you see it while the work is still going on. Our article on accounting for construction companies goes into more detail.

Crews often change from month to month. Each new employee must be entered in the employment register (TÖR) before they start work. That means we need their details before their first day on site, not at the end of the month.

Wages are reported in the payroll tax return (TSD), the monthly return for salaries and payroll taxes. It is due by the 10th of the following month. On top of gross pay, the employer pays social tax of 33%.

Does the reverse charge apply to construction work in Estonia?

No. In Estonia the domestic reverse charge does not cover construction services, so you charge VAT on construction invoices in the usual way.

The reverse charge means the buyer accounts for the VAT instead of the seller. Between VAT-registered businesses it covers the following.

• The sale of immovable property where the seller has chosen to charge VAT.
• Metal waste and precious metals.
• Certain metal products listed in the VAT Act, such as steel bars and rods, beams and sections, pipes and welded mesh.

For a construction company this matters mainly when you buy or sell those metal products, or sell property. For ordinary construction work you charge the standard 24% VAT.

Accommodation, tourism and the summer season

Accommodation is taxed at the 13% VAT rate, while most other things you sell are taxed at 24%.

A guesthouse that also sells tours or rents out bikes therefore uses two rates. Each sale needs the right rate on the invoice and in the VAT return.

Pärnu is known as Estonia's summer capital, and many businesses hire extra staff for the season. Seasonal staff are entered in the employment register like anyone else, and their holiday pay needs planning too. Our article on holiday pay rules explains how it works.

If you would like to talk things through face to face, we can meet in Pärnu. Documents, returns and the annual report can all be handled online, so meetings are always optional.