One of the most common questions we hear from e-residents is whether they can use their Estonian company to work as a freelancer or contractor for clients abroad. The short answer is yes, but the long answer is more nuanced, and it depends on how you structure your work, where your clients are based, and what your local tax obligations look like.
At Unicount, we’ve helped thousands of e-residents launch Estonian companies for remote work. Many of them are developers, designers, consultants, marketers, and other professionals who want to invoice international clients without the complexity of local bureaucracy. Estonia’s e-Residency program makes this possible, but it’s important to understand the legal and tax implications before you get started.
Freelancing through an Estonian OÜ: What’s allowed
Estonia allows e-residents to register and manage private limited companies (OÜs) entirely online. Once your company is established, you can use it to invoice clients anywhere in the world. You can work with agencies, startups, corporations, or individuals as long as the services you provide are legal and properly documented.
Your Estonian company can issue invoices, sign contracts, receive payments, and pay taxes in Estonia. You’ll be subject to Estonian corporate rules, including annual reporting and VAT registration if applicable. You can also pay yourself a salary or distribute dividends, depending on your company’s profitability and structure.
What you need to watch out for
While Estonia makes it easy to operate internationally, your home country may have its own rules about foreign income, tax residency, and disguised employment. This is especially important if:
- You’re working for a single client who treats you like an employee
- You live in a country with strict anti-avoidance laws
- You’re trying to reduce your personal tax liability by using a foreign company
Some countries may view your Estonian company as a “personal service company” and apply local tax rules accordingly. Others may require you to declare foreign income, register for VAT locally, or even pay corporate tax if they consider your company to have a permanent establishment in their jurisdiction.
This doesn’t mean you can’t use your Estonian company; it just means you need to be aware of the risks and structure your business properly.
Contractor vs. Employee
If you’re using your Estonian company to work for a former employer, or if you’re providing services that look like employment (fixed hours, supervision, exclusivity), some tax authorities may treat you as an employee in disguise. This can lead to reclassification, back taxes, and penalties.
To avoid this, make sure your contracts reflect genuine business-to-business relationships. That means:
- Clear scope of work
- Defined deliverables
- Flexible working arrangements
- Multiple clients, if possible
If you’re unsure, speak to a local tax advisor who understands cross-border structures. They can help you assess your risk and adjust your setup if needed.
How Unicount supports Freelancers and contractors
Unicount was built for e-residents who want to run lean, compliant businesses from anywhere in the world. Our one-click company registration makes it easy to launch your Estonian OÜ, and our accounting service helps you stay on top of your obligations from monthly declarations to annual reports.
We don’t offer tax advice in your home country, but we do help you stay compliant in Estonia. That includes:
- Forwarding official notices from the Estonian Tax and Customs Board
- Connecting you with licensed accountants who understand remote work
- Providing clear guidance on VAT, dividends, and salary payments
If you’re planning to use your Estonian company for freelance or contract work, we recommend starting with a clean structure, clear documentation, and professional accounting support.
Final thoughts
Estonia’s e-Residency program is a powerful tool for freelancers and contractors who want to work internationally without the friction of local bureaucracy. But like any tool, it works best when used correctly. Understanding your obligations, both in Estonia and in your country of residence, is key to building a sustainable, compliant business.
If you’re ready to start or are already working through your Estonian company, Unicount is here to help. We make company formation simple, accounting seamless, and compliance easier to manage so you can focus on doing great work, wherever you are.
