We advise you to consult a professional tax adviser to clarify the circumstances surrounding the taxation of income from investment funds. The overview only describes the most general principles of taxation and may not address aspects that are important for the taxation of the income of a particular unit holder.
SEB does not act as an advisor to the unit holder in tax matters, and this also applies if specific tax behaviour is referred to in this overview, investment fund documents, or other information materials. Tax legislation may change in the future.
Further information on the investment funds mediated by SEB, including the terms and conditions of investment funds, public offer prospectuses, financial statements, and other relevant information, is available on the website at www.seb.ee/en/business/savings-and-investments/investments/investment-funds.
Introduction
Taxation of income earned from an investment fund depends on the residence and legal form of the investor, as well as the type of fund and income and several other circumstances. In addition, the legislation provides some investors with a number of significant tax incentives or imposes different tax conditions on certain types of funds.
In order to apply the tax rules, it is first necessary to know whether the income of the investor has arisen from so-called growth units or income units. There are tax differences for income earned from both mandatory and voluntary pension funds as well as foreign investment funds.
In the case of growth units, the income earned or loss received by the fund is reflected in the change in the net asset value of the units or shares (hereinafter: units) of the fund: the net asset value of a unit either increases or decreases. The investor has received income from the fund if the redemption price of their unit exceeds the acquisition cost.
In the case of income units, the fund distributes all or part of the income earned to the investors as disbursements without redeeming the units. Disbursements are usually made in cash, but they can also be made to the investor by issuing additional units (free of charge) at the expense of the income of the fund.
Income of a natural person is taken into account for income taxation in the tax period in which the income was received. Deductions from taxable income are taken into account in the tax period in which they were paid. The tax period for the types of income covered by this overview is the calendar year. Learn more (PDF)
