Submission of declaration form TSD

Declaration of income and social tax, unemployment insurance premiums and contributions to mandatory funded pension (form TSD) is submitted by the 10th day of the month following the month the payment was made. The declaration includes a summary form and annexes.

Possibilities for submitting the declaration

  • The declaration can be submitted in the e-MTA by either entering data manually or uploading as a file. 
    The declaration may be uploaded as an XML file, in a single file or separately by annexes. In addition, annexes 1 and 2 and the INF1 form can also be imported from a CSV file after the declaration has been formed. 

    submit declaration

  • The declaration can also be submitted via X-tee.

  • The form TSD can be submitted on paper only if there are up to five rows, i.e. five or less recipients to be declared.

Instructions for submitting the declaration

1. Non-resident employee’s employment income ...

1. Non-resident employee’s employment income amount under 1200 euros per month

Employee with an employment contract, wages or salaries or other similar payment under 1200 euros (payment type 120)

Juhani is a Finnish tax resident receiving remuneration according to an employment contract in the gross amount of 1000 euros per month. He is not of Estonian retirement age. Juhani has submitted an application to the employer to apply the basic exemption of 500 euros per month

Mandatory funded pension contributions (II pillar) cannot be withheld from payments made to a non-resident recipient. 
In case the payment is up to 1200 euros, the basic exemption amount is up to 500 euros (depending on the size of income and the application of the taxpayer). All payments made to the same person within a calendar month are added up.

As Juhani is tax resident of Finland (a Member State of the European Union),  and a valid certificate of Juhani´s tax residency confirmed by the Finnish Tax Administration has been submitted to the Estonian Tax and Customs Board, the Estonian employer may apply the basic exemption as prescribed in the Estonian Income Tax Act when calculating the income tax amount to be withheld from the Estonian taxable income. 

TAX CALCULATION
  • Social tax 1000 × 33% = 330 euros
  • Withheld unemployment insurance premium 1000 × 1.6% = 16 euros
  • Employer´s unemployment insurance premium 1000 × 0.8% = 8 euros
  • Withheld income tax (1000 – 16 – 500) × 20% = 96.80 euros

Net payment of 887.20 euros (1000 – 16 – 96.80) is made to Juhani’s bank account.

DECLARATION IN ANNEX 2 OF FORM TSD

Payment recipient

Payment

A1/E101 country

personal ID code in Estonia

name or first name and surname

country

type

amount

2000

2010

2020

2030

2040

2060

12345678900

Juhani

FI

120

1000

Amount subject to social tax

Social tax

Payment subject to unemployment insurance premium

Unemployment insurance premium

Unemployment insurance premium withheld

2070

2110

2120

2130

2140

1000

330

1000

16

8

Amount subject to income tax

Tax exemption

Income tax rate

Amount of income tax withheld

type

amount

2150

2154

2155

2160

2170

1000

610

500

20

96.80

EXCEPTIONS IN TAX CALCULATION
  • If an employee is of the Estonian retirement age, unemployment insurance premium (code 2130) is not withheld at the rate of 1.6 % from payment (16 euros in the example).

  • If form A1 “Certificate concerning the social security legislation which applies to the holder” has been issued to an employee from a foreign country (country of the European Economic Area (Member State of the European Union (EU), Iceland, Liechtenstein, Norway) or Switzerland; Finland in the example) the country has to be indicated in code 2060 and Estonian social tax is not calculated in code 2110 (330 euros in the example) nor unemployment insurance premiums in code 2130 (16 euros in the example) nor in code 2140 (8 euros in the example).

BASIC EXEMPTION CANNOT BE APPLIED
  • If there is no valid certificate of tax residency certified by the tax authorities of a country of the European Economic Area (Member State of the EU, Iceland, Liechtenstein, Norway; Finland in the example), it is not allowed to apply the basic exemption amount in codes 2154 and 2155 (500 euros in the example). 

  • Upon calculating the withheld income tax in Estonia, the basic exemption cannot be applied on payments made to tax residents of third countries (countries not mentioned in the previous clause).

TAX CALCULATION
  • Social tax 1000 × 33% = 330 euros
  • Withheld unemployment insurance premium 1000 × 1.6% = 16 euros
  • Employer´s unemployment insurance premium 1000 × 0.8% = 8 euros
  • Withheld income tax (1000 – 16) × 20% = 196.80 euros
  • Basic exemption cannot be applied and codes 2154 and 2155 are not filled in.

Net payment of 787.20 euros (1000 – 16 – 196.80) is made to Juhani´s bank account.

Last updated: 01.03.2022

Last updated: 19.08.2022

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