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Types of companies
- Private Limited Company (OÜ) is the most popular due to its simplicity and limited liability.
- Public Limited Company (AS) for large enterprises.
- Sole proprietorship for individual entrepreneurs.
E-Residency
The e-Residency program allows non-residents of Estonia to establish and manage Estonian companies online. This makes it possible to have a digital identity in the EU and use digital administrative services that are necessary for business.Registration process
- The registration process is carried out entirely online through the e-Residency digital portal, including the selection of the company name, registration and tax registration. A digital ID is required.
- The company needs a local legal address and a contact person in Estonia.
- At least one director is required, who can be of any nationality and does not have to be an electronic resident. There are no residency requirements for directors.
- There are no restrictions on the nationality or residence of shareholders. A company can be established with one shareholder.
Bank account
- To open a bank account, you need e-Residency. The procedure can sometimes be done online, depending on the bank. Some banks may require a personal meeting.
- Fintech solutions can be an alternative for those who cannot open a traditional bank account.
Taxes
- Income tax is applied only to distributed profits at a rate of 20%, calculaated as 20/80 of the net distribution. This means that only the part of the profit distributed to shareholders is subject to income tax, and the rate applicable to this part is 20%.
- There is no corporate tax on reinvested profits.
- VAT registration is required if taxable sales exceed EUR 40,000 per financial year.
- Individual income from dividends is taxed separately.
Annual reporting
- Annual reports are required even if the company does not carry out any activities.
- Financial statements must be submitted to the commercial register.
- If the company is a VAT payer, periodic VAT returns must be filed.
Digital infrastructure | Privacy
- Allows remote management of almost all aspects of the company, including banking, filing tax returns, and signing documents, using the country's e-government services.
- Information about shareholders and directors is publicly available. However, using legal entities as shareholders can provide a certain level of privacy.
Protection of intellectual property (IP)
Estonia provides robust IP protection in line with EU standards. Registration of trademarks and patents is simple and can also be done online.Access to the EU market
As an EU member state, companies registered in Estonia benefit from access to the single market, facilitating trade within the EU.Visa requirements
- Non-EU citizens who wish to reside in Estonia may need to apply for a residence permit.
- E-Residency does not grant physical or tax residency; it is mainly a digital tool for business management.
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