Benefits related to transport, accommodation, parking and options as of 1 July 2017

If an employee’s home is at least 50 km away from the workplace:

• The employer can cover the employee’s accommodation expenses tax free, provided that the accommodation is necessary for business and the expenses do not exceed 200 euros per calendar month in Tallinn and Tartu and 100 euros elsewhere.
• The employer can cover transport expenses for travelling between the employee’s place of residence and place of work tax free (this includes transport organised by the employer with a category M2 or M3 vehicle as well as the employee’s own expenses incurred on transport between the place of residence and the place of work). 

Compensation of parking fees

The employer can compensate without paying taxes the parking fee paid upon using a personal passenger car in the fulfilment of service, work or professional duties on the basis of cost documents and without taking into account the kilometres driven.

Proportional implementation and reporting of tax exemption on long-term shareholding options

Upon the complete sales of an enterprise the options earned by the moment of the sales can in the case of an option agreement of at least three years be realised partly (proportionally) without paying fringe benefit taxes.

In order to prevent possible fraud, option agreements concluded or amended as of 1 July 2017 must be forwarded to the tax administrator within five working days (except for notarised or digitally signed option agreements)