Estonia Company Registration (Pros and Cons) / Should You Form a Company in Estonia?
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- Опубліковано 21 лип 2024
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Should you consider registering a company in Estonia?
What kind of benefits do you get if you form a company in Estonia?
As you probably know, Estonia is very forward thinking European country. Few years back it introduced e residency, which is quite a different concept from what we’re used to seeing.
Today we’re talking about Estonia from business structuring point of view.
We’ll cover taxes, banking and everything else you will want to know when it comes to forming a company in Estonia.
Who are we and what do we do?
We are Offshore Citizen team. We help people become global: get a second passport, set up a second residency, pay less taxes, do banking abroad, etc.
We have lots of interesting articles on different topics, we have relevant information up to date.
Author: Michael Rosmer
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Michael I enjoy you covering every jurisdiction.
Is Ireland not a lot easier, cheaper and get banking?
Basic corporate tax rate is 12.5% with some good tax breaks for new entrants.
This needs an update. Tax rates changed and some of the stuff covered here. Thanks for sharing.
Yes this is always an issue, information gets outdated, thanks for pointing it out
please make an update!
and please tell us about the new updates!
It would be awesome if you could give a free 15 mins consultation for nsw customers.
I would love to see a video about VAT in Europe. For example for selling goods or services online across Europe and globally from a company in different EU countries or from companies outside the EU. How get VAT back for your company expenses in other European countries? Challenges related to drop-shipping like fulfilment by Amazon. When can services be sold without paying VAT etc.
Thanks for the suggestion!
How did you like this video?
@@OffshoreCitizen I like this type of videos. I'm trying to figure out where to set up companies for startups in different industries so I try to learn what countries are ideal for my needs.
Michael, is the non-resident tax-free salary allowed for the management board members?
Suggest to make videos with PPT bullet points. Your videos are viewed by international audiences.
Fair suggestion
When someone send you money from Kanya to South Africa must the receiver pay clearance fee to the agent witch makes me the receiver confused agent name Henry J
Really insightful, thank you. I'd love to hear your advice for my situation - I co-own a music company registered in Barcelona, Spain (the company is my partner and I, we don't have employees.) She's French, I'm British. We're looking for a more efficient accounting system as the tax/admin in Spain is quite punishing. We've contemplated changing company registration to Estonia / Andorra, but concerned of the implications. Would love to hear from you. Thanks, Shervin.
Shervin, there's a lot to cover here and it's probably best to discuss all the details together.
We'll go through the options and I'll guide you on the best solution and any next steps.
The team and I can then assist through the process. If interested, you can book a consultation calendly.com/michael-rosmer
Imagine dropping a comment only to be shilled a €600 usd consultancy
@@unite3717 Imagine asking for complex tax advice in a UA-cam comment (that requires a lot of research and case-by-case analysis) and expecting a straight-forward answer
Solid stuff, thanks. Was wondering about the statement you made regarding non-taxation of wages earned in a foreign country. Does this essentially mean I could 1. Establish a company via e-residency, 2. Pay wages to my personal bank account in, for example, South Africa and 3. Pay only personal income tax in SA and not pay corporate tax for profit distribution in Estonia? Or does the 20/80 rule still apply in this case?
Yes that's generally correct though the details can matter
Maybe a bit late reply, I live in Thailand and pay myself as employee as I am both owner and sole employee, all the personal income tax are paid in TH, zero tax in Estonia, but I have to pay some state fees and Estonian accounting service. I need the company to access Estonian's Paypal with my business account, Thai Paypal is not working with many website I sell my digital goods on, so I still find it worth it, if I don't pay those fee, I'll lose more money as I lost access to many markets.
It's been 2 years since I have this company, no problems at all, I feel that it's like a security, to have stable access to EU financial as Thai government is not to be trusted, rules changed made Paypal doesn't work for a lot of people, last year was pandemonium ,Etsy and Ebay sellers and much more suffered.
The 0% corp tax isn't even that attractive. In the UK I can pay 0% corp tax by just taking wage,dividend, and offsetting expenses. For example in the UK in 2021 you could buy a Tesla and offset £35,000 against your corp tax (in most people's cases, meaning 0%) lol. The biggest issue is getting money from Business > Personal at a rate that doesn't break the bank
Hi! Banking with Fintechs work just fine in Estonia and you don’t need to have an Estonian bank account to build or keep your Estonian company.
Indeed. Banks are needed if you want a loan only
But will it result in 0 % tax or impact the income tax if I'm a European citizen? Banking in Africa morocco for example?
@@berbern5291I'm also interested in this
Estonia, one of the icy Baltic gems, an interesting topic. Estonia using the euro is a big plus, banking a negative, taxation is interesting but as you warned the catch is in the other taxation jurisdiction, such as the dreaded ATO.
Why would you prefer Estonia to Latvia?
Latvia has a bigger population...
Thank you for another interesting topic.
Bri
Hi great video ! May i ask , do you have to have an estonian Bank account for your estonian e residency company ?
This is hard. You must prove a link to Estonia. Search for fintech solutions.
Hi Michael, this doesn't have to do with the video but I wanted to ask if you could discuss if it's worth it for an American expat living in NZ or just expat in general to have a 401k or an IRA? In my situation America considers a Kiwisaver in NZ to be a trust I can't put money into this account. But I am trying to find a way to shield my earnings from taxes and I know that a 401k or an IRA is a way to do so. I work for an American company and I am self employed.
Sounds like an interesting topic to cover, thank you Camila!
@@OffshoreCitizen No Thank you, Michael. The amount of info that you give is seriously gold.
"The available banking does not handle USD very well" - hehe, so, not a good start if you consider e residency for an online company?
Depends where your clients are based
Do I need to file vat reports even if the company is intended to be a pure equity holding? (Meaning it wont produce or receive vat at all)
you need to register as VAT payer only if the taxable turnover exceeds 40k euro
interesting, I'd never heard of Estonia as a good place for registering your business. Could you essentially pay yourself a huge wage rather than a dividend every year and be tax free?
No because you’d have income tax on the dividends
Why are you saying “ banking on the other hand is not so great” ? You mean for non-EU citizens?
Yes
You should think about a separate asmr channel. Your voice is very calming and soft, it's very nice listening to your videos apart from the content.
nice
would estonia be a good option for someone running a dropshipping business?
This is perfect
Hello, I have dual citizenship Canadian and Ukrainian and I would like to apply for e-residency in Estonia fo start an LLC for my social media agency with my Ukrainian passport, cause majority of my clients are abroad. I have lived abroad for years and now I wanna come back to Toronto. Should I open an Estonian company with my Canadian Passport or with Ukrainian? And is there any option for me to pay zero or minimum taxes to be able to leave in Canada, not abroad? Thanks indeed
Estonian rules are mostly irrelevant here it's Canadian rules that matter if you'll live there
Best is to send us a message through www.offshorecitizen.net
Great video. So if you pay yourself a salary from your Estonian company, but you are personally a tax resident in a territorial tax country (like I am in the Philippines), then you would owe 0% tax to Estonia and 0% personal tax to the Philippines?
Pretty sure you gotta pay your personal income tax to phillipines
You should still pay income tax in Philippines.
Moldova has it as well 0% tax for profit.
Really?