With its e-residency program, Estonia provides a convenient solution for opening your business online. The e-residency program is aimed at freelancers, digital nomads, internet startups and all other location-independent entrepreneurs and allows access to advantages of doing business in Estonia – 0% corporate tax on undistributed profits, online tax filing as well as an opportunity for remote business administration.
The first step in starting a business in Estonia is applying for e-residency. More detailed information about this program can be found here: https://e-resident.gov.ee. It takes just a few clicks to complete the application and provide one’s motivation for becoming an e-resident. Also a state fee, 100 EUR, must be paid.
It must be emphasised that e-residency is a virtual residency. It enables e-residents to use the same services and all the advanced online solutions most Estonians use to conveniently manage their business enterprises online, but it provides neither a residence permit, nor does it issue a visa nor give any preferential treatment when travelling to Estonia or abroad.
The process of becoming an e-resident takes approximately 1.5-2 months. The Estonian Police and Border Guard take 30 days to review the submitted application and then, if application has been approved, an e-residency starter kit is sent to one of the 39 Estonian embassies or consulates around the globe, a list of which can be found here: https://e-resident.gov.ee/faq/.
The next step after becoming an e-resident and receiving the e-residency starter kit (e-residency chip-card, card reader and necessary codes) is to download the ID-software at www.id.ee.
Having successfully become an e-resident, a new company in Estonia can be registered by the e-resident online.
As each company requires a local address, it is wise to contact a service provider, such as HandelsHaus (www.hshaus.com), for a registered address service. A local address will be requested during the company registration process at the governmental company registration website – https://ettevotjaportaal.rik.ee/index.py?chlang=eng (by logging in with an e-residency card). The whole process is straightforward: checking whether the desired company name is available, and if it is – paying the 190 EUR fee and waiting for confirmation of the company being registered.
Once the company is registered, the next step is usually opening a bank account. There are several options for this, but currently none of the traditional banks in Estonia offer remote account opening. For this reason we recommend employing the services of fintech companies, such as Holvi or Paysera, which can open an account remotely. Of course, there is always the option of travelling to Estonia and seeing the beautiful country with one’s own eyes, while dealing with setting up the business.
Finally, when the business is up and running, it is important to remember the figure “16 000 EUR per year”. When this turnover is exceeded, the company has to be registered as a VAT payer and start filing monthly reports (2). Having a turnover below 16 000 EUR per year means that only annual returns must be filed. Please contact HandelsHaus for a quote.
HandelsHaus specialises in assisting fintech and e-commerce companies, as well as startups, in setting up their businesses by providing registration services and helping them to apply for the various licenses which are needed to run a fully comprehensive fintech business. HandelsHaus assists fintech startups and specialises in licence acquisition as well as regulatory approvals for:
- payment services providers
- payment card acquiring and issuing companies
- bitcoin and other cryptocurrencies trading and exchange businesses
- bitcoin mining
- crowdfunding etc