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Company registration in Estonia
Gateway Estonia
Ease of Doing Business rank
#18 out of 190 countries around the globe
Index of economic freedom
#10out of 186 countries the globe
International Tax Competitiveness Index rank
#1out of 36 countries the globe
Why Estonia
Estonia is a great hub for high-tech businesses due to the relatively cheap educated labor (in comparison to other EU/EEA countries) and tax-favorable environment. Estonia was a cradle for such giants as Skype, Bolt, Transferwise, Pipedrive and others. At the same time, the Estonian government made very attractive regulations for blockchain and digital asset-oriented projects due to the low threshold of share capital required and relatively simple and fast procedure for
Item
Rate
Value Added Tax (VAT)
20%
VAT Reduced rate
0% - 0%
Corporate tax (tax on retained earnings)
0%
Capital Duty
0.1-2.5%
Land Tax
25%
Tax on dividends for individuals (approx.)
~ 16.3%
Individual income tax (tax on salary)
20%
Payroll tax
0%
Social Security Contribution (paid on the top of the salary)
33%
Minimum salary (per hour)
3.48 EUR
Minimum salary per month
584 EUR
Average rental price for class A office spaces/ per 1 sq. meter
14.5 EUR
Share capital requirement for LLC
2500 EUR
Share capital requirements
Limited Liability Company and Public Limited Company have different minimum share capital requirements. For Public Limited Company it is 25.000 EUR and for Private Limited Company it is 2.500 EUR, however Private Limited Company may be established without immediate contribution of share capital as it should be contributed during 10 years of company activity or before the dividend withdrawal.
Timeline to set up a company
Depending on which method is used to establish company, time required for the process may vary. If establishing a company through e-Residency, then part of time will be taken also by registration of e-Residency card (one month approximately) if it was not previously owned. While using power of attorney the registration of notarial processes might also take some time. To sum up:
- By e-Residency card: 1 day
- By the power of attorney: 3-5 working days after we get all the documents
- By physical presence: 3-5 days
Business climate
Business environment in Estonia is favorable due to its location and taxation system for companies with 0% corporate income tax on retained or reinvested profits. Estonia is within 3-hour flight from most major European, Scandinavian and Russian cities, which in combination with a profitable taxation system makes it the leading country in Europe in terms of attracting foreign direct investments. Economy in Estonia is rapidly growing and highly globalized which offers even a bigger interest for a foreign investors. With that a numerous international giant companies like Microsoft, CGI, Google, Fujitsu, ABB and Ericsson have their branches. Estonia is a good place not only for doing business, but also for finding partners from all across Europe.
A company in Estonia can be established remotely with ease even for non-EU residents. The process could be simplified with Estonia’s remarkable feature — the e-residency card. Further, the majority of administrative activities can be done online thanks to the digital services and legal framework in place, so there is no need to travel to the country where your company is registered just to handle the paperwork. Most companies in Estonia were established online. Estonia is the first country in the world that provides such opportunity. e-Residency can be applied for in several easy steps on governmental website.
Customs duties
1
1
As Estonia is a member of EU, all aspects of custom duties are decided by TARIC - the common customs tariff in European Union. Custom Duty rates are based on value of the goods and dependent on its type and the country of origin. Imports from EFTA countries, Switzerland and EU candidates are generally free of duty. Usually, duty rates stay between 0% and 10%
2Free Trade Zones
3Labor force
4Business migration opportunities
Being a young and rapidly developing jurisdiction, Estonia offers one of the most comfortable and friendly environments to run the business in Europe. Estonia has developed and implemented the solution called e-residency which allows non-estonian residents to access estonian e-government resources and operate their estonian company totally remotely from any part of the world. In addition to the ability to remotely operate the business, Estonia offers friendly taxation regime and plenty of highly skilled and educated labor force, especially in the field of IT, which makes it a great place to start your business in Europe.
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What is included in the company formation service package
Company formation
Full turn-key assistance with setting up a company in EU by Power of Attorney (remotely) or by physical presence including such steps as verification of the company name; preparation of individual AoA, coordination of all necessary legal formalities and handling of the company entry into the commercial register.
Bank Account
The issue of opening a corporate account in the Bank for the company where non-EU residents are acting as directors and shareholders is still urgent. Our services for opening an account include an analysis of your business model, risk assessment and selection of the optimal Bank in the EU, collection and preparation documents package (in accordance with the requirements of the chosen Bank), representation of your interests in negotiations (if necessary).
Registered and Virtual Office
In order to set up a company in EU jurisdiction, the address of registration and virtual box services are required. In the frames of our solution, we provide an address in EU and assist with mail forwarding and other incoming physical correspondence from governmental authorities, Banks and third parties. Upon request, we could assist with EU phone number and receptionist answering on the calls.
Legal Templates
As soon as the company registration procedure is fully completed, the question of starting operating activities becomes relevant. In order to accelerate the process and save money on local advisors, we will provide all the necessary legal document templates drafted in accordance with EU law (NDA, employment agreement, service agreement, policies etc.)
Tax number obtainment
Registration of your entity within EU tax authorities and acquisition of VAT number and internal tax number (if applicable)
Dedicated consultant
Our aim is to make the moment of launching your business maximum simple, so it would be possible to concentrate on important matters and operate efficiently. Therefore, you will be provided with an individual consultant who will lead you through the entire process of the company formation and further will be assisting with other business-related issues and unique needs
Auxiliary services
Accounting and Taxation
Legal entity registered in EU obliged to conduct bookkeeping records and submit reports to the state authorities (Income tax and social security contribution report on employees, VAT reports on a monthly basis and annual reports). Jointly with our partners, we will be happy to assist your company on this matter and develop an optimal taxation model individually under your business.
Trademark registration
Registration of trademark within European Union Intellectual Property Office (EUIPO). Word mark, figurative mark, figurative mark containing word elements, shape mark, shape mark containing word elements, position mark, pattern mark, single color mark, sound mark, motion mark, multimedia mark, hologram mark.
Local Director
The need for local hired director often in demand across our Clients since it resolves issues with Bank compliance (if any arise) and makes it possible to conduct remotely operating activities more efficiently. We will carefully analyze your needs and weigh all the risks in order to conduct a search for a suitable candidate for the position.
Explore other jurisdictions in Europe
- Zero rate corporate tax
- Ability to set up and run company using e-residency card remotely
- Great hub for high-tech business
Estonia
- Economical Capital and largest market of the EU
- Impeccable reputation “Made in Germany”
- Highly qualified labor force
Germany
- Capital of the EU in the heart of Europe
- Plenty of governmental programs aimed to support IT and FinTech business
- Multimodal transport hub for value-added logistics
Luxembourg
- Unique Tax Incentives suitable to optimize significantly tax burden of functioning business with setting up LP form.
- Gateway to the United Kingdom
Ireland
- Excellent gateway to Europe from CIS countries
- Most affordable labor costs (331 EUR minimum brut salary per month)
- Lowest corporate income tax (9%)
Montenegro
- Tax incentives for holding companies (profits of all overseas subsidiaries are taxed at a zero rate)
- High level of anonymity
- Well-developed banking system and loyalty from the authorities
Cyprus
- Lithuania occupies one of the leading positions in the ranking of the world´s freest economies on the ease of starting a business, as well as one of the leaders in Europe according to the index of investment attractiveness
- Opening business in Lithuania is popular due to the low costs of accounting and administration, low taxes, and good geographical position
Lithuania
Connect with our experts
Contacts
Email:[email protected]
Lõõtsa tn 2a, 11415 Tallinn, Estonia
Žalgirio g. 88-101, Vilnius, Lithuania
Phone: +37066108308
License for operating activity: FIU000407
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