Salary Calculator
Estonia
Select the country and currency and enter the salary details. Our salary calculator then generates detailed breakdowns of net and gross earnings, along with additional insights into tax liabilities, health contributions, and pension costs specific to the chosen country.
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How does the salary calculator for Estonia work?
The salary calculator for Estonia estimates both gross and net earnings by considering multiple factors. It begins with the gross salary, which includes base pay, bonuses, and any additional agreed-upon compensations. Then, Estonia’s flat tax rate is applied.
In addition, the calculator factors in social security contributions from both the employee and employer, which cover essential services like pensions and healthcare. After these taxes and contributions are accounted for, the calculator provides the net salary, which is the amount the employee will actually receive.
What is the salary cost in Estonia?
Employees in Estonia contribute 1.6% of their gross salary to the unemployment insurance fund and 2% to the Estonian pension system (second pillar) if they are participating in the funded pension scheme.
On the other hand, employers are required to pay 33% of the gross salary towards social security, which includes contributions for healthcare and pensions. This breakdown includes:
-20% for pension insurance (state pension system), 13% for healthcare insurance, and
-0.8% of the employee's gross salary to the unemployment insurance fund.
How much tax do you pay in Estonia?
Estonia applies a flat income tax rate of 20% to all personal income, regardless of the amount earned. This means that every individual pays the same percentage of their income in taxes. The country also has a unique corporate tax system where profits are not taxed until they are distributed. The corporate income tax rate is 20% on distributed profits, such as dividends.
*Please note that these rates can vary based on legislative changes.
What are the mandatory employee benefits in Estonia?
Estonian law guarantees 28 calendar days of paid annual leave. In certain professions, like government officials and academic staff, extended leave is granted, up to 56 days per year in some cases.
Estonia operates a three-pillar pension system. The first pillar is the state pension, funded by social taxes. The second pillar is a mandatory funded pension where employees contribute 2% of their gross salary, and the government adds 4% from the employer's social tax contribution. The third pillar is a voluntary pension plan that allows additional contributions.
Estonia offers 140 days of paid maternity leave at 100% of the employee’s salary. Fathers are entitled to 10 days of paternity leave as well, and parents can take parental leave for up to three years with government-provided benefits.
Are there any other benefits or additional expenses?
Many employers offer gym memberships or on-site fitness programs to promote employee health and well-being. They often invest in their employees by providing professional development opportunities, such as funding for further education, conferences, certifications, or training programs.
What is the difference between Gross and Nett in the Estonia Salary Calculator?
In Estonia, the difference between gross and net salary is determined by the deductions made from the gross salary for taxes and social security contributions. The gross salary represents the total earnings of an employee before any deductions. This includes the base salary, bonuses, and any other compensation. On the other hand, the net salary is the actual take-home pay an employee receives after all mandatory deductions.
How can Native Teams help with employment, salary and taxes in Estonia?
At Native Teams, we offer comprehensive solutions to simplify employment, payroll, and tax management in Estonia. Our platform is equipped with various tools and services aimed at streamlining payroll operations while ensuring compliance with Estonian regulations. We assist employers in handling salary calculations, tax obligations, and benefits administration. With our support, you can ensure timely and accurate salary payments, reduce administrative complexities, and rest assured that all legal requirements are efficiently met.
