VAT in Estonia: VAT Number, Rates and Registration

VAT in Estonia (käibemaks) applies to most goods and services, and an Estonian company must obtain a VAT number once its taxable turnover exceeds €40,000 in a calendar year. Value Added Tax is an indirect tax added at each stage of production or distribution and ultimately borne by the end consumer — and, like other European Union countries, Estonia levies it on most domestic sales of goods and services.

Eesti Firma, a recognised expert in company formation in Estonia and accounting services, shares practical guidance on Estonian VAT and the VAT number on this page — how to obtain one, which VAT rates apply, who must register, and what happens after registration.

What Is VAT in Estonia?

In Estonia, VAT is a consumption tax added at each stage of the supply chain — production, distribution and retail — and calculated as a percentage of the final price paid by the consumer. Businesses charge VAT on their sales and can usually deduct the VAT paid on their own business purchases (input VAT), so the tax ultimately falls on the end customer rather than on the business.

In Estonia, a business must register for VAT — becoming a VAT payer (käibemaksukohustuslane) — once its taxable turnover exceeds €40,000 within a calendar year. A company can also register voluntarily before reaching this threshold when VAT registration is beneficial or necessary for its business model — for example, in cases of international trade, distance sales, or when working mainly with VAT‑registered partners.

VAT in Estonia is governed by the Estonian Value Added Tax Act (aligned with the EU VAT Directive 2006/112/EC) and administered by the Estonian Tax and Customs Board — the national tax authority.

Estonian VAT: Main Points (2026)

A practical summary of VAT rates, registration and reporting for companies in Estonia.

VAT Rates in Estonia

Estonia has four VAT rates: a standard rate of 24%, reduced rates of 13% and 9%, and a zero rate of 0%, each determined by the nature of the transaction. Understanding these categories — standard, reduced, zero-rated and exempt — helps businesses calculate VAT correctly, stay compliant and plan their finances. Below is a breakdown of each category so you can identify the rate that applies to your products or services.

Standard VAT Rate — 24%

The standard rate rose from 22% to 24% on 1 July 2025 (it was 20% until the end of 2023 and 22% during 2024). It applies to most taxable goods and services in Estonia — general retail goods, professional and IT services, electronics and most business transactions that do not qualify for a reduced rate or an exemption.

Reduced VAT Rate — 13%

Since 1 January 2025, accommodation and accommodation with breakfast are taxed at 13% (up from the previous 9%). The reduced rate applies to the accommodation service itself and to breakfast included in it, not to other services supplied alongside accommodation.

Reduced VAT Rate — 9%

A 9% rate applies to books and educational materials, prescription medicines and certain medical devices, and press publications such as newspapers and periodicals (both physical and electronic, excluding mainly advertising or adult content). Press publications moved from the earlier super-reduced 5% rate to 9% from 1 January 2025.

Zero Rate — 0%

A 0% rate (an exemption with the right to deduct input VAT) applies chiefly to international and intra‑Community trade: intra‑Community supplies of goods to VAT‑registered buyers in other EU member states, and exports of goods to non‑EU countries. Specific services such as the international transport of goods, and certain items such as investment gold, are zero-rated or exempt under special provisions of the EU VAT Directive.

VAT‑Exempt Transactions

Some goods and services are exempt from VAT — no VAT is charged to the customer, and the supplier generally cannot deduct related input VAT. Exempt categories in Estonia include many social and public-interest activities: healthcare and medical services, educational services, financial and insurance services, and the sale or rent of certain immovable property. In defined cases, a taxable person may opt to tax an otherwise exempt transaction (for example, the sale of real estate) to gain the right to deduct input VAT, provided the tax authority is notified and the conditions in the VAT Act are met.

Who Needs to Register for VAT in Estonia?

You must register for VAT in Estonia once your taxable turnover exceeds €40,000 in a calendar year — but not every company needs to register right after incorporation. Registration depends on your turnover, the types of transactions you carry out, and whether you trade within the EU or internationally. The main conditions are set out below.

• Turnover threshold — €40,000: once your taxable sales in Estonia exceed €40,000 in a calendar year, you must submit a VAT registration application to the Tax and Customs Board (in practice, within 3 business days of crossing the threshold). If you expect to exceed it soon, it is often wise to register slightly beforehand.
• Intra-Community acquisition of goods — €10,000: even if your sales are below €40,000, you must register if you acquire more than €10,000 worth of goods from other EU member states during a calendar year.
• Non-EU businesses selling in Estonia: a non‑EU business with no permanent establishment in Estonia generally has no threshold and must register before its first taxable supply. It is usually also required to appoint a tax representative in Estonia, who is jointly liable for VAT. EU‑based companies do not need a tax representative and can register directly.
• Voluntary registration: you may register before reaching €40,000, which is common for businesses that mainly sell to VAT‑registered clients or want to reclaim significant input VAT on investments. Voluntary registration is subject to approval — the Tax and Customs Board may ask for evidence of genuine or intended taxable activity, such as a business plan, contracts or invoices.

How to Register for a VAT Number in Estonia

Registering for an Estonian VAT number is a straightforward process, but it requires an application and details about your business. All applications are handled by the Estonian Tax and Customs Board (Maksu- ja Tolliamet).

Where to Apply

• Electronic application: the easiest method is the Tax and Customs Board’s e‑service portal (e‑MTA). You log in with a secure electronic ID — an Estonian ID card, Mobile-ID or e‑Residency digital ID — which lets e‑residents apply conveniently from abroad.
• In person: you can submit the application at a Tax and Customs Board service office in Estonia if you prefer face-to‑face service.
• Through a representative: you may authorise an accountant or lawyer to apply on your behalf under a power of attorney — a useful option for non‑resident entrepreneurs.

Information Needed

• Company details: official name, registry code, legal address and contact information.
• Business activity description: a brief explanation of the goods or services you provide and how the business will generate taxable sales in Estonia or the EU.
• Planned transactions and partners: where applicable, key prospective clients or suppliers — especially VAT‑registered ones — as their VAT numbers can strengthen the application.
• Projected turnover: an estimate of expected sales and, for voluntary cases, the reason VAT registration is being sought.
• Supporting documents: the Board may request contracts, invoices, purchase orders or a business plan to verify your information.

Applications are usually processed within 5 business days when everything is in order, and the VAT number often arrives as an e‑MTA notification. If the authority needs clarification (common for new companies with no turnover yet), it may ask for contracts, invoices or other evidence of economic activity, which can extend the review. Responding promptly and thoroughly helps avoid delays. Once approved, your company receives a VAT number in the format EE123456789 — the country code “EE” followed by nine digits (the EE‑number). You can check or verify any Estonian VAT number, and confirm it is valid in the EU VAT system, in the European Commission’s VIES database.

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After Registration: VAT Compliance and Reporting

Obtaining a VAT number is only the beginning. Once registered, your company has ongoing obligations to charge, report and pay VAT correctly. Non-compliance can lead to penalties, so it is important to understand what is required.

• Charging VAT and issuing invoices: from the date of registration you must add VAT to your taxable sales at the correct rate (24%, 9%, etc.) and issue proper VAT invoices showing your and the customer’s details, the invoice date and number, a description of the goods or services, and the VAT rate and amount (or a note where the sale is zero-rated or exempt).
• Taxable period and VAT returns: the standard taxable period is a calendar month. You must file a monthly VAT return (KMD) even in months with no activity, and the return and any payment are due by the 20th of the following month — for example, the March return is due by 20 April.
• EU sales listing and annexes: if you make intra‑Community supplies, you must file the report on intra‑Community supply (the VD report, Estonia’s EC Sales List) monthly with your VAT return, detailing your EU customers’ VAT numbers and the value of zero-rated sales to each. Domestic sales and purchase invoices are reported in the KMD INF annex to the VAT return, and businesses moving goods across EU borders above the statistical thresholds may also need to submit Intrastat reports.
• Record keeping: keep sales and purchase invoices, as well as import and export documents, for at least 7 years, as required by Estonian law.
• Payment and refunds: if output VAT exceeds input VAT, you pay the difference by the due date. If input VAT is higher, the credit is normally carried forward or refunded after verification, which can take a month or more for larger amounts.
• Input VAT deductions: you can reclaim the VAT paid on business purchases used for taxable supplies. On each return you subtract input VAT from output VAT — for example, the 24% or 9% VAT on office rent, equipment or supplies. Where a purchase is used partly for exempt or non‑business purposes, only the taxable portion is deductible, and valid purchase invoices must be kept.
• Small-business scheme: Estonia generally uses monthly filing, but the EU small-business VAT scheme can let qualifying small enterprises simplify their VAT obligations or stay exempt up to defined thresholds — worth checking if your business is small.

Special VAT Schemes and Arrangements

Estonian VAT law, in line with the EU VAT Directive, offers several special schemes that certain businesses can use or must follow. They typically simplify accounting or address specific industries.

• Cash accounting scheme: smaller businesses may account for VAT on a cash basis — declaring and paying VAT only when the customer pays, and deducting input VAT only when the supplier is paid. Conditions apply (including a turnover limit set in the VAT Act), the Tax Board must be notified, and each invoice must be marked “cash accounting”. It helps with cash flow but delays the right to reclaim input VAT until payment.
• Domestic reverse charge: for certain B2B transactions the seller does not charge VAT and the VAT‑registered buyer self‑accounts for it. In Estonia this applies to items such as scrap metal, certain metal products, construction services, real estate where the seller has opted to tax, and investment gold when opted to tax. The invoice states “reverse charge applies”; this does not apply to retail sales to consumers.
• One Stop Shop (OSS): if you sell digital services or goods online to consumers in other EU countries, OSS lets you keep your Estonian VAT number and declare the VAT due elsewhere through a single quarterly return filed in Estonia. The Tax and Customs Board then distributes the tax to each country — greatly simplifying cross‑border B2C compliance.
• Taxation of immovable property: most sales of used real estate and residential rentals are exempt, but a seller can opt to charge VAT on certain B2B property transactions. The option must be notified to the Tax and Customs Board in writing before the transaction, and the reverse charge may then apply if both parties are VAT‑registered.
• Imports and the customs union: import VAT on goods from outside the EU is typically paid at customs; frequent importers may consider deferred import VAT accounting or customs warehousing. Exports are 0%, but customs export documents must be kept as proof of the zero rating.

International VAT Considerations for Estonian Businesses

Because Estonia is an EU member, local companies often trade across borders. Having an Estonian VAT number plays a key role in the treatment of these transactions.

• Intra-EU B2B sales: selling goods to a VAT‑registered business in another EU country is an intra‑Community supply. With valid VAT numbers on both sides you apply 0% VAT, show the customer’s EU VAT number and note “intra‑Community supply”, and the customer accounts for VAT in their country (reverse charge). Without a VAT number you generally cannot make VAT‑free sales to EU business customers.
• Intra-EU B2B purchases: when you buy goods or certain services from an EU supplier, you self‑assess Estonian VAT on the acquisition and, for taxable use, reclaim it on the same return — usually no net tax. Below the €10,000 acquisitions threshold and without a VAT number, foreign suppliers may charge their local VAT.
• Cross-border B2C sales of goods: above the EU‑wide €10,000 distance-selling threshold you must charge VAT in the customer’s country. The simplest way to comply is OSS, which lets you report all foreign VAT through your Estonian VAT number rather than registering in each country.
• Providing services abroad: many B2B services fall under the general reverse charge — you do not charge Estonian VAT and the business client self‑accounts for it. For B2C services the default is Estonian VAT, but digital electronic services to consumers are taxed where the consumer is located (hence OSS), and services relating to immovable property are taxed where the property is.
• Transactions outside the scope: some activities — grants, donations, or the sale of a business as a going concern — fall outside VAT entirely and do not count toward the threshold. A mix of such revenue and taxable revenue can get complex and is worth reviewing.
• Coordination with income tax: Estonia’s corporate tax is charged only on distributed profits, but VAT and profit taxes run side by side. Some costs may be non‑deductible for income tax yet reclaimable for VAT, and vice versa — good bookkeeping keeps both aligned.