In 2016 the amount of basic exemption, increased basic exemption in event of pension, and the monthly rate which is the basis for the minimum social tax obligation will change.
- Income tax is withheld at the rate of 20%.
- Basic exemption is 170 euros per month (the recipient of the payment must make a corresponding application).
- Increased basic exemption in event of pension is 225 euros per month (only applied to recipients of I and II pillar pension).
- Increased basic exemption in event of occupational accident benefit or occupational disease benefit is 64 euros per month (the recipient of the payment must make a corresponding application).
- Social tax rate is 33%. Monthly rate which is the basis for the minimum social tax obligation is 390 euros (355 euros in 2015), which means that the minimum social tax obligation is
128.70 euros per month.
NB! Has not been passed yet.
- Unemployment insurance premium rate is 1.6% for employees and 0.8% for employers. The obligation to withhold an employee’s unemployment insurance premium (1.6%) ends when the employee reaches the pensionable age or on the last day of the month when early retirement pension is granted. The employer will still be obligated to pay unemployment insurance premiums at the rate of 0.8% established for the employer on wages paid to an employee who is of the pensionable age or to an employee who has been granted early retirement pension.Example
The premium will no longer be withheld for a male employee whose personal identification code starts with 35212… as of 01.01.2016 (pensionable age is 63 years).
The premium will no longer be withheld for a female employee whose personal identification code starts with 45301… as of 01.02.2016 (pensionable age is 63 years).
- Rate of contribution to the funded pension is either 2% or 3%. The obligation to withhold contributions to the funded pension and the rate of contribution applicable to a specific person in 2014–2017 can be checked on the basis of the person’s personal identification code or by making a mass enquiry. At the same address the final date of withholding a mandatory contribution to the funded pension in the case of elderly employees must be checked (the obligation to make mandatory contributions to the funded pension ends on 31 December of the year of the first redemption day of II pillar pension fund units). This means that if, for example, an employee who has reached the pensionable age started receiving funded pension payments in the middle of 2015, then II pillar contributions (2% or 3%) had to be withheld on payments made until 31 December 2015 and no contributions shall be withheld on payments made as of 1 January 2016. For employees who have reached the pensionable age but who continue to work and do not start receiving funded pension payments, the funded pension contributions are still calculated as usual.
As for calculating wages and other compensation for December 2015 as well as taxes (contributions) withheld and calculated thereon, it is important to remember that, according to the cash accounting principle, if the wages for December are paid in January, the taxes and contributions must be calculated at 2016 rates and declared on the TSD form submitted for January (date of submission 10 February 2016). But if the wages for December are paid in December 2015, the calculation/withholding of taxes and contributions is subject to 2015 rates and the taxes and contributions must be declared on the TSD form submitted for December 2015 (date of submission 11 January 2016).
Tõlke aluseks on maksu- ja tolliameti artikkel 2016. aasta maksumäärad ja maksuvaba tulu suurus.