20.03.2025
At the beginning of 2019, LHV Pank and the Estonian Tax and Customs Board introduced an innovative new form of small business account for private individuals – the Entrepreneur Account. Today, over 30,000 people are using this service, with their transaction volumes surpassing EUR 50 million last year.
The Entrepreneur Account offers a simple, low-cost, and bureaucracy-free way for individuals to operate as entrepreneurs. While small business owners generally face a lot of challenges with taxes, this is not the case with the Entrepreneur Account – everything is automated, and there are no accounting obligations.
Over the past two years, the number of the Entrepreneur Account users has tripled, with around 30,000 active users today. According to Violetta Platonova, Private Client Area Manager at LHV, the Entrepreneur Account has gained increasing popularity, both in terms of the number of users and the range of sectors represented.
‘Earning extra income alongside a full-time job is becoming more relevant each year. Many are looking for ways to turn their skills, knowledge or hobbies into a source of income. The Entrepreneur Account offers the perfect freedom for this, as you can engage in business activities whenever it suits you – whether seasonal, needs-based or dependent on your free time. With the Entrepreneur Account, there are no ongoing accounting obligations, lifting the usual business-related responsibilities from account holders,’ Platonova explained.
According to Riina Randver-Sõer, the Service Manager of the Income Tax Department at the Estonian Tax and Customs Board, the numbers also confirm the active use of the Entrepreneur Account. In 2024, there were 29,341 active Entrepreneur Account users and transactions totalled over EUR 50 million. For the state, this translates into more than EUR 10 million in tax revenue.
In 2019, when the Estonian Tax and Customs Board and LHV Bank launched the Entrepreneur Account, a total of 1,702 accounts were opened. Today, there are more than 30,500 Entrepreneur Accounts. New ways of working – platform work, virtual jobs, and being your own employer – have all contributed to the growing popularity of the Entrepreneur Account. The most common users of the Entrepreneur Account are service providers working through platforms, such as food delivery couriers, ride-sharing service providers, translators, and others, as well as providers of other services like babysitters, pet sitters, housekeepers and tutors, massage therapists or sellers of homemade products,’ Randver-Sõer described.
Additionally, thanks to a change in the simplified taxation law for business income last year, the Entrepreneur Accounts now benefit from a more favourable tax rate. Previously, a 20% tax rate applied to those Entrepreneur Accounts with income under EUR 25,000 and a 40% rate applied to income exceeding that threshold. From 1 January of this year, a uniform 20% tax rate now applies to all income exceeding EUR 25,000 but less than EUR 40,000 within a calendar year.
The Entrepreneur Account received recognition at the 2024 Estonian Business Awards, where it won the Ministry of Economic Affairs and Communications’ Award for Promoting Entrepreneurship, and it was also specially acknowledged in the category for promoting entrepreneurial spirit at the European Enterprise Awards.
For more information and examples of how the Entrepreneur Account works, visit the Estonian Tax and Customs Board website.
All news