Be ready: The VAT rate in Estonia will change from July 1st, 2025

From July 1st, 2025, the standard VAT rate in Estonia will be 24% instead of the current 22%. Find more details on the Estonian Tax and Customs Board homepage.

Make sure to choose the correct VAT code, as from July 1st all purchase invoices will have 24% VAT rate.

Notice that automatic coding rules will continue to use the old VAT code until the new VAT code is set as the default VAT code. Once the new VAT code is set as the default, the rules that previously used the default VAT code will be automatically updated to use the new default. However, rules that were using other VAT codes (i.e., not the default) will not be updated automatically and will require manual adjustment

For the VAT rate change you need to make two changes:

STEP 1: Create a NEW VAT CODE with a 24% rate
For the integration with your ERP to work, the new VAT code in eFlow should match the new VAT code in your ERP.

Master Data > VAT CODES: Choose “Add”, fill in the data, and save.

STEP 2: Set the new VAT code to be the default VAT code
After you have coded most of June 2025 invoices, the new VAT code should be defined as the default VAT code.

Master Data > VAT CODES: Find “Default”, hover over the text and click on the pencil icon:

Delete the old default VAT rate and select the new 24% VAT by searching for it and then clicking on it.

When clicking on the new VAT rate the system will ask you if you want to change all the coding rules that used the default VAT code from the old default VAT code to the new default VAT code. Answer “YES”. Changing the default VAT code to the new 24% code will change the old VAT code to the new VAT code in all automatic coding rules. The old VAT code remains in the system and can still be used manually if needed.