Dividends are payment of the profit to owners of the business in agreed proportions. Similar payments are subject to tax the rate of which is different in each country. Such tax is also paid in Estonia. Rate of the tax on dividends in this country is 20/80.
For calculation of the amount to be received by an owner of the business in case of profit distribution, it is necessary to multiply a total amount by the quotient of division 20/80. It means that if dividends amounting to 10,000 euro are paid, after deduction of the tax a shareholder will receive 2,500 euro (10,000*(20/80)=2,500).
This rate is lower than in many countries and this fact in combination with other advantages of the taxation system of Estonia makes this country the best one for registration of a business.