Minimum Salary & Tax Changed in Estonia

Estonia Payroll Outsourcing Alert – Government announces New Social Security Contribution & Increase in Minimum Monthly Salary for 2020

Estonia payroll outsourcing leader issues a statutory alert for Estonia.

Mercans has alerted its Estonia payroll outsourcing clients of Monthly Salary & Social Security related changes.

• Estonian government has announced that the minimum monthly social security contribution will increase to 178.20 EUR from 165.00 EUR.
• The government increases the minimum monthly salary to 584 EUR from 540 EUR. The minimum monthly salary applies to all full-time employees. The minimum salary is also used as the base for the calculation of additional leave days’ pay for parents and study leave pay.
• Public transportation ticket reimbursement for employees who work at least 50 km from their place of work is no longer considered taxable fringe benefit and can now be reimbursed as non-taxable income.
• The Estonian government has also increased the annual income tax exemptions for second child to 1,848.00 EUR and third child to 3,048.00 EUR;