27.12.2024
From 1 January 2025, a uniform tax rate of 20% will apply to the income received in the Entrepreneur Account, regardless of the annual income. This change will greatly simplify the use of the Entrepreneur Account, as the current two-tier tax system will be eliminated. For clients who have joined the second pension pillar, the funded pension payment rate (2%, 4% or 6% according to the choice made) is automatically deducted from the Entrepreneur Account.
Currently, a tax rate of 20% applies to the Entrepreneur Account with an annual income of less than 25,000 euros, and a tax rate of 40% applies to the Entrepreneur Account with a higher income between 25,000 and 40,000 euros.
Already at the beginning of 2019, LHV Pank and the Estonian Tax and Customs Board introduced a new small business form, or the Entrepreneur Account. ‘The popularity of the solution is also shown by statistics – as of December 2024, as many as 28,807 Entrepreneur Accounts have been opened, and this number is growing by an average of 1,000 accounts per month,’ Annika Goroško, the Head of Retail Banking at LHV, explains.
The Entrepreneur Account is an innovative solution that allows a private person to act as an entrepreneur without the usual bureaucracy. This means that there is no need to worry about accounting reports, monthly tax returns, and manual payment of taxes – everything is done automatically based on the entries that are received in the account. Read more about how to use the Entrepreneur Account.
All news