Income tax exemption on gifts and donations made to MTÜ Slava Ukraini

The Estonian Parliament adopted on 7 December 2022 changes to the income tax legislation, which inter alia exempt gifts and donations provided by companies to MTÜ Slava Ukraini. Until now, such gifts and donations for the benefit of Ukraine were tax exempt without limitation only when provided to the below-listed non-governmental organizations:

1) MTÜ Estonian Refugee Council;
2) MTÜ Mondo;
3) Ukrainian Cultural Centre;
4) National Defence Promotion Foundation;
5) Estonian Red Cross;
6) Rescue Association;
7) Rotary International District 1420 (Rotary Klubi Tallinn Vanalinn).

The referred law amendment will become effective from 23 December 2022. Thus, companies can provide gifts and donations to MTÜ Slava Ukraini from 23 December 2022 until the end of the year 2023 on a tax exempt basis, without taking into account the limitations prescribed by § 49 of the Income Tax Act and declaring them in the Appendix 5 of form TSD.

In addition, MTÜ Slava Ukraini has been entered by the Tax and Customs Board to the list of non-governmental organizations with income tax incentives from 1 October 2022, which enables individuals to provide to it donations within the established limitations (the total amount of housing interest, education expenes and donations cannot exceed EUR 1200 per annum) so that these donations are deductible from the individual’s taxable income in the annual income tax return.