Investment account

You can use an investment account if you want to postpone the taxation of the income that you have earned on your investments. This means that you can re-invest the whole of your earned income
  • An investment account is a normal current account that is dedicated for making financial investments.
  • You can use an investment account if you want to postpone the taxation of the income that you have earned on your financial assets.
  • The investment account system was created by the amended Income Tax Act, which came into force in January 2011 and says that if you as a private investor invest through an investment account, you can postpone the taxation of the income that you have earned on your investments.
  • You can use an investment account if you want to postpone the taxation of the income that you have earned on your financial assets. In order to benefit from this provision, you will need to transfer some money to your investment account and buy some securities for it.
  • If you sell these securities and transfer the amount you have earned back to your investment account, you do not have to pay tax on your earnings immediately but can re-invest all of the money in new securities.
  • You will have to pay income tax when you take out more money from your investment account than you have paid into it.
  • For the purposes of the Income Tax Act, you can use any current account that you open in Estonia or in a member state of the European Economic Area (EEA) or the OECD as an investment account.
  • You need to declare all the accounts that you use as investment accounts in your income tax return, and show all the payments to and from these accounts in a consolidated form.
Frequently asked questions about investment accounts:

      - What are financial assets for the purposes of an investment account?

      - Do I need to open a separate current account for my investments?

      - If I want to invest in securities, do I have to open an investment account?

      - How is my investment income taxed if I have an investment account?

      - When would it be reasonable to use the investment account system?

      - What is considered as a payment to an investment account?

      - Can I have more than one investment account?

      - How is income earned on index-linked or structured bonds taxed under the new Income Tax Act?

      - What should I do if I want to sell securities that I bought before 1 January 2011?

      - Can I use the money on my investment account as collateral?

      - How are financial assets that I have inherited or been given as a gift taxed in the investment account system?

      - Can I close my investment account and if so, how?