Estonia is a small country in Northern Europe, populated by 1.3 million people. However, Estonia is one of the most advanced and developed digital environments globally.
When it first started, Estonia was the first country in Europe and in the world to establish the concept of e-Residency. It’s an electronic residency issued by the government, which allows you access to Estonian government services and a paperless business environment. All bank transactions can also be done online.
According to Estonia-company.ee, since October 2020, more than 73,000 people from more than 170 countries have applied for e-residency, having already created over 14,000 Estonian start-ups.
There are a few options to choose from when it comes to registering a company in Estonia:
- Company registration with an e-resident card allows you to start and manage your business online, from any place in the world.
- Company formation in Estonia by visit. For this one, you need to send all the requirements in advance and visit Estonia for one day.
- Opening a company in Estonia by a power of attorney, or
- Ready-made/shelf companies in Estonia, which means you are acquiring an already established company.
As the Estonian Chamber of Commerce and Industry says on their website, there are three types of costs, when establishing a business:
- The state fee for establishing a company is 190 euros (electronically) or 145 euros (through a notary). The state fee can later be recognised as a business expense.
- Notary fees depend on the size of share capital and the number of founders.
- The share capital of the private limited company (OÜ) is at least 2500 euros, but it can be also established without contributing the share capital if the proposed area of activity does not require capital investments.
One of the things that attract most business owners is the Estonian tax system. The income tax rate for private entrepreneurs and corporations is 20%. However, there’s no corporate income tax on retained and reinvested profits. Nowadays, 98% of businesses are established online there. The country has a growing economy and is one of the fastest-growing startup hubs in the EU.