Navigating VAT registration is a key step for every Estonian e-resident establishing a company. In 2025, understanding when and how to register, what rules apply, and how Unicount supports you through the process is essential for compliance and tax efficiency.
Who needs VAT registration in Estonia?
When you launch your OÜ (private limited company) in Estonia as an e-resident, VAT liability is not automatic. You must register for VAT only when your taxable turnover in Estonia exceeds €40,000 within a calendar year.
- Mandatory Registration Threshold: €40,000 per year from January 2025
- If threshold is exceeded: You must register as a VAT payer within three business days.
- Your VAT obligation starts from the moment your turnover reaches €40,000, not only from the date you register.
Unicount’s experts help you register for VAT promptly, avoiding late registration penalties.
Voluntary VAT registration in Estonia: When does it make sense?
Before you reach the threshold, you can register for VAT voluntarily if you can demonstrate genuine business activity, usually through a business plan or existing Estonian clients.
- Voluntary registration is useful if your suppliers are VAT-registered, or your clients require VAT invoices.
- The Tax and Customs Board may refuse registration if your company has no real economic activity in Estonia; evidence such as contracts or partnership agreements strengthens applications.
Unicount supports voluntary registration applications, ensuring all documents meet tax board requirements, saving time and increasing approval probability.
VAT rules for Estonian e-Resident companies
- Standard VAT rate: 24% from July 2025 on sales to Estonian residents or non-VAT registered EU clients.
- B2B sales to EU or third countries: Usually 0% reverse charge applies, requiring both your and your client’s VAT numbers and clear reference on the invoice.
- B2C sales (final consumers abroad): Complex, Estonian VAT may apply unless the nature of the services qualifies for an exemption. You may also need to register for VAT in the client’s home country, depending on local rules (especially digital services/MOSS scheme).
Unicount provides guidance to structure your invoicing for correct VAT treatment and can advise if you need registration outside Estonia.
VAT reporting and compliance: What e-Resident need to know
Once registered for VAT, you must:
- Add VAT to eligible invoices per Estonian law
- Submit monthly VAT returns via the e-Tax portal (due the 20th of the following month)
- File the KMD main declaration and Annex KMD INF listing invoices above €1,000 with Estonian entities
- Report cross-border EU B2B services on monthly VD declarations
- Keep detailed records of all transactions in case of audit
Failing to submit VAT returns results in penalties and possible deregistration of your VAT number. Unicount’s monthly accounting and VAT return service ensures you remain compliant and penalty-free.
VAT refunds and deductions
If your company’s input VAT (VAT paid on purchases) exceeds output VAT (VAT you charge on sales), you can request a refund from the Tax Authorities after proper review. These funds are credited to your prepayment account for use against future tax liabilities or refunded directly.
Foreign VAT liabilities and EU cross-border issues
It’s crucial to determine if your operations create VAT obligations in other EU member states.
- If you sell to consumers outside Estonia, check whether you need local VAT registration in that country
- For digital services to EU consumers, consider the OSS (One Stop Shop) VAT scheme
Unicount provides VAT registration and cross-border VAT advisory for e-residents to ensure your compliance everywhere you do business.
Frequently Asked Questions: Estonian VAT registration
Do I need to register for VAT immediately after starting my company?
No, only after your annual taxable supply reaches €40,000. Voluntary registration is possible sooner with genuine business activity.
How long does VAT registration take?
Mandatory registrations are processed quickly (within 3 business days). Voluntary applications can take up to 5 days, depending on documentation.
Who must file monthly VAT returns?
Every VAT-registered company must file returns monthly, even if there were no transactions.
What happens if I miss the deadline or make errors?
Penalties apply for late filing or incorrect returns. Unicount’s monthly service eliminates this risk.
Why choose Unicount for VAT registration & support?
Unicount is your reliable partner for VAT registration, accounting, and ongoing VAT compliance.
- Monitoring your turnover and advising on registration timing
- Preparing and submitting all VAT registration forms
- Managing monthly VAT returns and records
- Advising on best practices for cross-border VAT
- Ensuring you avoid costly mistakes, penalties, or loss of VAT status.
Thank you for reading!
VAT registration can be complex, but with Unicount you have expert support every step of the way. Don’t risk penalties or missed business opportunities and contact Unicount for fast, efficient VAT registration and tax management for your Estonian e-resident company.
