PwC Estonia’s tax and accountancy team: key projects in 2022

We helped one of the largest operators of heat production plants in the Baltics to develop pricing principles for intra-group transactions and prepare the necessary documentation. The project was notable both for its large scale and the number of different countries involved in the project. In cooperation with PwC Legal, we also formalized the agreements necessary for the execution of transactions.

In cooperation with our colleagues from international offices, we prepared transfer pricing documentation for a group operating in the aviation industry. We are proud of the achieved results, because the work required sector-specific knowledge. The project was also made more difficult by the fact that it involved Asian and African countries.

We helped a group operating in the field of gambling to evaluate its activities from the point of view of tax efficiency and to find income tax and VAT savings. The project concerned different countries and required knowledge of the tax rules of these jurisdictions and consideration of administrative practice.

In 2022, as usual, we came into contact more with maritime and related tax issues. We helped a foreign shipping company to register under the Estonian flag and apply the tax discount for seafarers. The project was made special by the fact that it was one of the first foreign companies to implement the said tax regime. In relation to the maritime sector, we also supported Estonia's energy security by creating clarity in the tax issues of the LNG terminal.

In connection with the war in Ukraine, we have been more exposed to various immigration and related tax issues. We have supported Estonian entrepreneurs in submitting proposals for amendments to the law and in simplifying administrative practices.

In 2022, there were also some significant legal disputes, concerning assessment of whether the VAT law is in line with European law. We also argued in the Supreme Court of Estonia about the protection of taxpayer's rights. In addition, this year we received positive answers to requests of clarification and binding preliminary ruling responses for a record number of 23 clients.

Over the years, we have been asked for help more and more with employee incentive programs and token taxation in the technology sector. It is an area that is still thinly regulated by legislation, which makes finding the right answers interesting and challenging.

Our client portfolio includes several renewable energy production companies, whose accounting calls for thorough understanding of national funding terms, drafting the relevant reports, communicating with the public sector, knowing the specifics of recording assets in their accounting system, and detailed project accounting.

An increasing number of companies in our client portfolio are from the field of information technology, which means that the resolution of issues related to software completeness level and cross-border taxation is required.

We prepared the accounts for one of Estonia’s biggest residential rental property companies and handled their tax accounting. We were also involved in accounting management projects in other real estate sectors such as office real estate and trade, which required the preparation of annual accounting reports based on IFRS.

We have a client whose main area of business is providing studies and analyses for the European Commission and whose accounting calls for specific competence – detailed project accounting, guaranteeing compliance with public funding terms, resolving complicated VAT and income tax issues related to several countries, and a lot of communication with the public sector.

Contact us

Hannes Lentsius

Hannes Lentsius

Tax Service Line Leader, PwC Estonia

Tel: +372 5691 1698

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