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Estonia Salary Calculator 2026

Calculate your salary easily by entering your data. The most accurate salary calculator with 2026 tax changes.

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Calculate from gross salary → other amounts

⚙️ Advanced settings (Pillar III, alimony, bailiff fees) ▼

2026 tax changes

• Tax-free income €700/month for all (progressive system removed)
• Income tax 22%
• Minimum wage €886
• Social tax minimum €292.38

Employer cost €
2676
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Gross salary €
2000
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Net salary €
1520
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Detailed calculation

Hourly rate (gross) 11.90
Income tax (22%) 377.81
Unemployment insurance (1.6%) 32.00
Funded pension 40.00
Additional deductions 0.00
Tax-free income 700.00

Employer taxes

Social tax (33%) 660.00
Employer unemployment (0.8%) 16.00
Total taxes 1093.81

Salary distribution

Taxes to state
Funded pension
Net salary

Professional salary calculator for accountants and employers, updated with all 2026 Estonian tax changes. Built by Estonian accountants who know exactly what's needed in daily work.

Biggest 2026 change: The progressive tax-free system is gone! Tax-free income is now a flat €700/month for everyone, regardless of earnings.

Why accountants choose this calculator

  • Accurate formulas: 2026 income tax 22%, tax-free income €700, correct social tax calculation
  • Three-way calculation: Enter gross salary, net salary, or employer cost — the rest is calculated automatically
  • Special cases covered: Pensioner taxation, Pillar II choices, additional deductions
  • Minimum social tax: Uses correct 2026 minimum rates (€292.38)
  • Verified results: Tested against Estonian Tax and Customs Board calculations

Complete Guide to Estonian Salary Calculations in 2026

1. Salary Components and the Tax System

Gross Salary — The Contractual Amount

The gross salary is the amount agreed upon in the employment contract. The following taxes and mandatory contributions are withheld from this amount:

  • Income tax 22% — goes to the state budget, including local government
  • Unemployment insurance 1.6% — goes to the state budget and the Unemployment Insurance Fund
  • Funded pension 0%, 2%, 4%, or 6% — directed to the employee's pension fund

Employer Costs — The Wage Fund

In addition to the gross salary, the employer pays the following mandatory contributions:

  • Social tax 33% — minimum €292.38/month (€886 × 0.33)
  • Employer's unemployment insurance 0.8% — calculated from gross salary
  • Total cost formula: Gross salary + (Gross × 0.33) + (Gross × 0.008)

All these taxes are paid to the Estonian Tax and Customs Board.

Practical tip: Total employer cost = gross salary × 1.338

2. Tax-Free Income in 2026 — The Progressive System Is Gone!

From 2026, a flat tax-free income of €700/month (€8,400/year) applies to everyone, regardless of income level. This is the biggest tax reform in recent years — the so-called "maksuküür" (progressive tax-free system) has been abolished!

2026 tax-free income:
  • All employees: €700/month (€8,400/year) — regardless of income
  • Pensioners: €776/month (€9,312/year) — regardless of income
  • Progressive system removed: Tax-free income no longer decreases with higher earnings

Important note: To use the tax-free allowance, the employee must submit a written application to the employer. Without an application, the tax-free allowance cannot be applied!

3. Practical Salary Examples for Different Income Levels

Gross salaryNet salaryEmployer costTotal taxes
€886 (minimum)€834€1,185€351
€1,500€1,305€2,007€702
€2,000€1,689€2,676€987
€3,000€2,457€4,014€1,557

* Calculated with €700/month tax-free income, Pillar II 0%, non-pensioner

4. Special Cases in Estonian Payroll

Pensioner Payroll

  • Tax-free income is €776/month (fixed amount)
  • The Social Insurance Board applies the tax-free amount to pension automatically
  • If the pension is below €776, the remaining portion can be used for employment income

Part-Time Employment

  • Social tax minimum applies proportionally (e.g., 0.5 FTE = €146.19)
  • Tax-free income is used in full regardless of working hours
  • Use actual working hours when calculating hourly rate

Pillar II Impact on Net Salary

  • 2% of gross salary — the default rate
  • 4% or 6% — voluntary additional contributions
  • All contributions reduce taxable income

5. Legal References and Sources

  • Income Tax Act (TMS) — § 4(1) (22% rate), § 23 (tax-free income €700)
  • Social Tax Act (SMS) — § 7(1) (33% rate), § 2(8) (minimum base €886)
  • Unemployment Insurance Act — sets the 1.6% and 0.8% rates
  • Funded Pensions Act (KoPS) — § 9 (contribution rates)
  • 2026 State Budget Act — sets minimum wage at €886

Important: Always verify current rates at the State Gazette and the Estonian Tax and Customs Board.

2026 Estonian Tax Parameters

Tax / parameter2026 ratePaid by
Income tax22%Employee
Social tax33%Employer
Social tax minimum€292.38/monthEmployer
Unemployment insurance (employee)1.6%Employee
Unemployment insurance (employer)0.8%Employer
Tax-free income€700/month—
Pensioner tax-free income€776/month—
Minimum wage€886/month—
Funded pension (Pillar II)2%, 4%, or 6%Employee

Source: Estonian Tax and Customs Board, Social Insurance Board. Effective from January 1, 2026.

Net Salary Calculation Formula

Net salary = Gross salary − Funded pension − Unemployment insurance − Income tax

where:

Funded pension = Gross salary × Pillar II %

Unemployment insurance = Gross salary × 1.6%

Income tax = (Gross − Pension − Unemployment − €700) × 22%

Employer cost = Gross salary + Social tax + Employer unemployment

= Gross salary × 1.338

Frequently Asked Questions

What changed in Estonia's tax-free income for 2026?
From 2026, the tax-free income is a flat €700/month (€8,400/year) for everyone, regardless of income level. The previous progressive system (maksuküür) where tax-free income decreased as earnings rose has been abolished. Pensioners receive €776/month tax-free.
How much does an employer pay on top of the gross salary in Estonia?
The employer pays social tax (33%) and employer's unemployment insurance (0.8%) on top of the gross salary. For example, a €2,000 gross salary costs the employer approximately €2,676 in total. The minimum social tax in 2026 is €292.38/month.
How is income tax calculated in Estonia in 2026?
Income tax is 22% of taxable income. Taxable income = gross salary – funded pension (Pillar II) – unemployment insurance (1.6%). The tax-free allowance (€700/month) is then subtracted. Income tax = (taxable income – tax-free allowance) × 22%.
How do I calculate net salary from gross in Estonia?
Net salary = gross salary – funded pension (Pillar II) – unemployment insurance (1.6%) – income tax (22% of taxable income after tax-free deduction). For example, with a €2,000 gross salary and 2% Pillar II, the net salary is approximately €1,658.
What is the minimum wage in Estonia in 2026?
The minimum wage in Estonia for 2026 is €886 per month. This is the gross amount before taxes. The minimum social tax obligation for employers is €292.38/month (€886 × 33%).
Does the calculator account for Pillar II pension contributions?
Yes. You can select a Pillar II rate of 0%, 2%, 4%, or 6%. If you have left Pillar II, select 0%. Pension contributions are deducted before calculating income tax, so a higher Pillar II rate reduces your income tax.
What is the social tax minimum in Estonia in 2026?
The minimum social tax in 2026 is €292.38 per month. This means even if the employee's salary is very low, the employer must pay at least €292.38 in social tax. This is based on the minimum wage of €886. The minimum does not apply to pensioners, students, and minors.
How are sick leave payments taxed in Estonia?
Only income tax is withheld from sick leave payments. Unemployment insurance and funded pension contributions do not apply. The employer does not pay social tax or unemployment insurance on sick leave. The employer pays sick leave from the 4th day for 5 days, at 70% of the average salary of the last 6 months.
Do I need to submit a tax-free income application?
Yes! The employee must submit a written application to the employer to use the tax-free allowance. Without an application, the tax-free allowance cannot be applied. The application can only be submitted to one employer at a time.
Do previous tax-free income applications still apply in 2026?
Yes, previous applications remain valid at the amount stated in them. If the application stated €654, that amount will still be applied in 2026. To use the new €700 tax-free amount, a new application must be submitted. If the application stated 'the maximum amount allowed by law', the new €700 limit applies automatically.

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Estonia Salary Calculator 2026 last updated: April 2026 | Built by the Uku team together with Estonian accountants

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