This November, our updates focus on various tax changes mandated by law, including the option to increase the funded pension contribution rate, updated VAT rates for accommodation services and accommodation services with breakfast and press publications, and other minor enhancements. Below, you’ll find a detailed breakdown of all the updates.
Funded pension contribution rate as of 1 January 2025
From January 1, 2025, individuals making contributions to the so-called second pension pillar have the opportunity to increase their pension contribution rate from 2% to 4% or 6%. Applications for this adjustment can be submitted until November 30, 2024.
To make this process easier, the employee card now includes an enhanced query feature linked to the Estonian Funded Pension Registry. We strongly recommend using this query to update the contribution rate instead of manually changing it, as the query method is faster and more convenient.
For bulk updates, you can use the mass query function. Simply navigate to Payroll – Employees, then select More -> Ask data from Pension Registry. The results will display employees whose data has changed. Once saved, their records will automatically be updated with the new information.
The salary calculator has also been updated and is available on the Payroll – Salary calculator page.
NB! Please check the data before calculating salaries.
The increase of the rate of withheld income tax from 20% to 22%
Starting in 2025, the individual income tax rate will increase to 22%. This change has already been implemented in the system and will automatically apply to all payouts made from January 1, 2025, onward.
New VAT rates starting January 2025: 9% and 13%
From January 1, 2025, the VAT rates for accommodation services and accommodation services with breakfast and press publications will change. The new VAT rate for accommodation services will be 13%, and for press publications 9%. These updates will also affect the VAT declaration starting from the next year.
VAT Rate for Media Publications: 9%
The existing VAT rate of 9% (including reverse charge VAT) will continue to apply to media publications.
VAT Rate for Accommodation Services: 13%
We have added new VAT rates of 13% (including reverse charge VAT) to the system. Articles taxed at 13% are now included in the default setup for new companies, along with corresponding accounts in the chart of accounts.
- Scheme 1:
- 30134 – Revenue from the Sale of Services in Estonia (VAT 13%)
- Scheme 2:
- 3070 – Sales Revenue (VAT 13%)
- Non-profit:
- 30134 – Revenue from the Sales of Services (VAT 13%)
Users can add new accounts or rename existing ones as needed. Please note that transactions will appear in the VAT declaration based on the VAT rate selected at the invoice line level, regardless of the account assigned.
Replacing VAT Rates
To streamline transitions, you can replace outdated VAT rates (such as 5% or 9%) with the new rates using the Settings – Update VAT rates page.
This replacement can be done manually at any time or set to occur automatically during the year-end. The replacement is a one-time action, but further adjustments can always be made manually afterward.
Clearer Billing settings page
We’ve enhanced the Billing Settings page to make it more user-friendly. This page allows you to change your company package or update invoice recipient details. If you manage multiple companies or recipients, it is now easier to identify which company’s details you are editing.
Enhanced feedback for email delivery
To improve clarity, we’ve updated the logic for outgoing emails from SmartAccounts. Previously, automatic replies (e.g., out-of-office messages) could occasionally be misinterpreted as delivery failures. With the new logic, the system now provides more accurate feedback, even when an automatic reply is received.
Swedbank Gateway ID Verification
If transactions between Swedbank and SmartAccounts seem delayed, the issue might be an incorrect Swedbank agreement ID. To prevent this, we’ve added an ID verification feature under Swedbank Gateway settings. If the ID is incorrect, you’ll be prompted to reconfigure the integration.
Smart-ID Now Available for Service Activation
You can now use Smart-ID to activate external services (e.g., integrations with the Tax and Customs Board, e-invoices, and banking interfaces), in addition to ID-card and Mobile-ID options.
Updated warehouse inventory import logic
We’ve improved the warehouse inventory import functionality to exclude zero-stock items that were initially categorized as inventory but have been changed to product or service type. Such items will no longer appear in the exported inventory file during downloads.
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If you have any questions, feel free to contact us at info@smartaccounts.eu.
