Articles
Estonian Tax Rates explained to e-resident founders
Starting a business can be complex, but understanding Estonian tax rates does not have to be. You can consider this to be a beginner’s guide, written in a simple language we like at Unicount when helping e-resident founders navigate the Estonian ecosystem.
After reading you may want to move here to benefit from the Estonian tax rates available to individuals and companies residing here. The country needs founders and top talent for technology companies and is a country with a thriving startup scene.
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Startup Funding for e-Resident Founders
Estonia, a country full of ambitious entrepreneurial minds, also extends a variety of resources and opportunities for growth to its e-Resident founders. Some grants may require your Estonian company to have a certain turnover or people on the payroll to qualify, while the startup funding and accelerators have no bureaucratic requirements stopping you from accessing them equally to resident founders.
Estonian flourishing startup ecosystem includes various grants, accelerators, business angels, venture funds and networking platforms available to all founders, aiding you in overcoming the initial hurdles of building a business from scratch in a foreign country. You may also want to learn about Estonia’s unique tax system and build your business here.
Estonian limited company shareholders are now part of company certificates
On 13 April 2022, the Estonian parliament adopted a brand-new Commerical Register Act which came into force on 1 February 2023. In our previous blog posts, we explained how the new legislation affected share capital requirements and removed the role of contact person unless a foreign address is used. One of the aspects of the new law came into force on 1 September 2023. It makes shareholder lists part of the public company registration certificates. We suggest reviewing your shareholdings in the Estonian Business Register if your companies have had transactions with shares after registration. This article provides a comprehensive overview of the key changes and their implications.
How many companies submitted accounts on time?
June 30 was the deadline for submitting annual accounts (annual report) for all Estonian companies whose financial year ended on 31 December 2022. Approximately 290 000 companies had to submit their annual report in June, which is roughly 95% of Estonian companies. 162 689 companies submitted accounts by the 30 June deadline.
This means that only 56% of annual accounts were submitted on time. Let’s look more into this issue, including what the Estonian government said about this figure and its plans. You may want to read this if you are an Estonian company owner who did not manage to submit accounts on time.
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Opening a Bank Account in Estonia
Estonia has become a hotspot for entrepreneurs and digital nomads with its e-Residency program. This program allows non-residents to establish and manage an Estonian company online and offers numerous benefits, including access to the European Union market.
One crucial aspect of running a business is having a reliable and efficient banking solution. This article will dive into the various banking options available for Estonian e-resident-owned and managed companies.
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Estonian VAT and income tax rates increased
In the early hours of 20 June, the Estonian parliament voted to raise several taxes. The previously agreed coalition agreement signed by the Reform Party, Social Democrats and Eesti 200 foresaw increasing income tax and VAT to cover the budget deficit. A major part of the deficit was related to the Reform Party’s expensive campaign promise to raise tax-free personal allowance to 700 euros for taxpayers from all income brackets.
Here is what was passed on the second and final vote in the parliament on the 20 June night session. The tax raise for the 2024 tax year was already very close to the legally required 6-month advance notice to taxpayers.
Estonian company registration certificates available online
Historically, well before Unicount and e-Residency came to town, non-residents having Estonian companies had to collect certified copies of registration certificates either from the Estonian Business Register by physically visiting it, or by visiting both Business Register and a notary. Estonian notaries would certify with their stamp that the Business Register stamped certificate was legit and sometimes even add an apostille if the certification of the Estonian notary was not good enough in the intended country of use.
In most cases, founders did not bother to come to Estonia for all that and had to pay their virtual office service providers to collect those stamped documents while paying hundreds of euros in fees. Not anymore.
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Why You Should Start a Company in Estonia
Establishing your first company can create a lot of uncertainty for first-time founders due to the bureaucratic requirements, complicated tax regulations, and hidden costs associated with having a company.
But not in Estonia.
This digital nation provides an easy online registration of limited liability companies. The small country offers entrepreneurs a fast track to register a company in one day, eliminating the hassle of filing paperwork and unexpected costs.
This article will explore the advantages of starting your company in Estonia and how you can benefit from the digital nation’s offer for establishing and running a company online.
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Estonian tax rates 2024-2025
On Wednesday 12 April, the Estonian parliament voted in favour of the new coalition government. One of the concerning items in the coalition agreement is changing Estonian tax rates to increase state revenue and thereby reduce government deficit spending. It is good to know though that Estonia currently is at the low end of tax-to-GDP ratio in the EU and has the lowest debt-to-GDP ratio. This has made Estonia a great place to build your global business.
Here is what we can read from the coalition agreement published on 8 April. It is important to note that none of it has been adopted by the Estonian parliament and a lot can change in the political process.
