The most important rule first: if you sell an apartment or house you used as your permanent or primary residence until the sale, the sale is exempt from income tax. Most homeowners pay nothing. Tax comes into play when you sell property that was NOT your home — a rental apartment, an investment, or an inherited or gifted apartment you didn't live in yourself.
When is a sale tax-exempt?
- You sell your permanent or primary residence — a home you actually lived in until the sale.
- The exemption can be used once every two years: if you sold a previous home tax-free less than 2 years ago, the next sale is taxable even if it was your residence.
- The length of ownership doesn't matter — what counts is actual use as your residence.
Watch the nuances: if the apartment was partly used for something else — half rented out, or used for business — the exemption may be only partial. In borderline cases, ask the Estonian Tax and Customs Board (EMTA) for a written position before selling.
If the sale is taxable: how much and on what?
Income tax (22% in 2026) is paid on the GAIN, not the full sale price. Gain = sale price − acquisition cost − documented selling and improvement costs. Bought for €100,000, renovated for €15,000 (keep the invoices!), paid the agent €4,000, sold for €150,000 — the gain is €31,000 and the tax €6,820.
- Acquisition cost: purchase price plus related costs (notary fee, state fee).
- Documented improvements are deductible: renovation, new windows, heating — keep the invoices.
- Selling costs are deductible: agent commission, appraisal report, notary, listings.
- A loss cannot be offset against other income (the securities regime doesn't apply to real estate).
Inherited or gifted apartment — the most common surprise
For inherited and gifted property the acquisition cost is zero: you cannot count the price the deceased or the donor once paid. That means the taxable gain is essentially the whole sale price minus your own costs. The tax on an inherited apartment sold for €120,000 can be nearly €26,000. The exception is the same as always: if you yourself lived in the apartment as your residence until the sale, it's exempt. More in our guide to selling an inherited apartment.
Declaring and deadlines
A taxable sale is declared in the following year's income tax return (filing opens in February). A tax-exempt home sale doesn't need declaring. For borderline cases — partial rental, multiple owners, two sales within a short period — always check with EMTA or a tax advisor. This article is a general explainer, not tax advice.
Plan the sale from the numbers
Before deciding, know what your apartment is actually worth — both your gain and your tax depend on it. Calculate your property's market value for free, and if you plan to sell fast, see our direct purchase service — an offer within one business day.