A joint-stock company subject to Estonian CIT since 2022 paid part of its 2024 profit as dividends, with the rest transferred to reserve and registered capital.
Background on Estonian CIT
A joint-stock company has been a taxpayer of the flat tax on company income, commonly known as Estonian CIT, since 2022.
2024 Profit Distribution
In 2024, the company achieved a profit. By decision of the general meeting, a portion of this profit was distributed to shareholders as dividends.
Capital Transfer
The remaining profit was transferred to the company’s capital accounts, specifically to both reserve and registered capital.
Estonian CIT and Registered Capital Increase
The article explores the relationship between Estonian CIT and the increase of registered capital, questioning whether this transfer represents a form of hidden profit.
