Salary: How we calculate
Calculate salary from gross, take-home pay or the employer’s total budget.
How we calculate
- In 2025, the income-tax rate is 22%; the tax-free allowance is up to 654 euros per month and gradually decreases for monthly income between 1,200 and 2,100 euros; the minimum monthly base for social tax is 820 euros.
- In 2026, the income-tax rate is 22%, the fixed tax-free allowance is 700 euros per month, and the minimum monthly base for social tax is 886 euros.
- For a person of pension age, the tax-free allowance is 776 euros per month.
- Gross salary is reduced by the selected Estonian funded-pension pillar II contribution and the employee unemployment-insurance contribution of 1.6%, when enabled. The employer additionally pays social tax of 33% and the employer unemployment-insurance contribution of 0.8%, when enabled.
- The 776 euro allowance is applied to pension first. Enter only the unused portion claimed for salary (0–776 euros per month). Leave 0 if pension uses the full allowance. This input stays monthly in annual mode.
- From 01.11.2026, the waiting period to resume pillar II contributions falls from 10 to 5 years. Resuming requires an application and the applicable statutory start date; five years passing does not restart withholding automatically. Contribution rates of 2%, 4% and 6% do not change.
- Early withdrawal under § 43¹ is allowed once. After resuming contributions under § 27², a further application for exemption from contributions is not available.
- Partial early withdrawal and resuming after a pause without withdrawing money, with no five-year wait, are provided for from 01.01.2028; they do not apply to the 2026 calculation.
The same general assumptions apply to 2025 and 2026: the tax-free allowance requires an application and may be used with only one employer, while annual mode assumes 12 equal monthly payments. Rates and thresholds come from the selected year. The tax year follows the payment date, not the month worked: December 2025 salary paid in January 2026 uses the 2026 rates.
Tax-free allowance with this employer, €/month
Enter 0 if another employer applies your allowance. Otherwise enter the amount in your application. This is always a monthly amount, including in annual mode.
In 2026 you may enter €0–700 per month. In 2025 the applied amount is also limited by the calculated maximum of up to €654, which decreases as income rises. Other income may affect your final 2025 annual tax calculation. The initial value follows each selected year’s rules; a manually entered amount is a shared cap. The allowance cannot exceed the tax base after employee contributions.
The Social Insurance Board (SKA) applies the allowance to your pension first. Enter only the unused amount declared to your employer: for example, a €676 pension leaves up to €100. Leave 0 if nothing remains.
Worked example
Monthly gross salary is €3,000 in 2026, allowance €700, funded pension 2%, with employee and employer unemployment insurance enabled. Pension is €60 and employee insurance €48. Taxable income = 3,000 − 60 − 48 − 700 = €2,192; income tax is €482.24 and net pay €2,409.76. Employer social tax is €990, insurance €24 and total cost €4,014.