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Declaration of income derived outside Estonia

  • Income derived outside Estonia is to be declared on a supplementary sheet of the income tax return ”Income derived outside Estonia”.
  • If at the period of declaration of income the person is abroad, he or she can submit an income tax return in the internet through the e-MTA.
  • Information on income received outside Estonia and the expenses paid in other Contracting State to the European Economic Area Agreement (tax incentives), which may be deducted from income, is not pre-completed.
  • Income derived abroad that is taxable in Estonia is declared in table 8.1 to 8.7 of the form ”Income derived outside Estonia”.
  • Although the taxable income from employment derived outside Estonia and the dividends received abroad are not subject to taxation in Estonia, they still have to be declared in table 8.8 of the income tax return form ”Income derived outside Estonia”. Also income, which according to an international agreement is not subject to taxation in Estonia, must be declared.
  • If social security payments and contributions (pension, health, maternity, unemployment, accident at work or occupational disease insurance) have been paid abroad, the payment of which is mandatory according to the foreign legislation or an under an international agreement, the aforementioned payment or contribution may be deducted in Estonia from the taxable income derived abroad (to be declared in table 9.3 of on the income tax return form).
  • Income received abroad shall be declared in the currency received (except for gains in table 8.2 or loss upon transfer of securities that are to be filled in euros). Income received abroad in currency other than euro will be recalculated into euros at the exchange rate effective in the European Central Bank at the date of receipt of income, thus columns for the dates were inserted in the table for income derived abroad. 
  • If a resident natural person of another state of the Contracting Party to the EEA Agreement has received income taxable in Estonia, then he or she can take into account tax incentives (including the basic exemption) in proportion to the share of the income taxable in Estonia in his or her taxable income for the period of taxation on the following conditions:
  1. If the person has derived at least 75 per cent of his or her total income in Estonia, he or she can use all the deductions provided for in Chapter 4 of the Income Tax Act.
  2. If the person has received less than 75 per cent of his or her total income in Estonia, he or she can use, as deductions, the basic exemption and the increased basic exemption in the event of pension, in the case the person receives pension payments.
  3. For that purpose he or she has to submit an income tax return for a resident natural person.
  • If, in addition to income derived in Estonia, a non-resident person has derived income abroad, such income will not be taxable in Estonia, but the data must be declared in table 8.9 of the form on income derived outside Estonia.