Estonian e-Residency in a nutshell
E-Residency is a secure digital identity provided by the Estonian government to a person who is not an Estonian citizen and has no residence in Estonia. This is the first such project in the world, which gives access to a country and its services online.
Your Estonian digital identity comes in the physical form of a smart card with a chip that you get after your identity and compliance have been confirmed by Estonian government agencies doing background checks of applicants.
We have written this article to have everything you need to know about e-residency in a two-minute read.
What are the benefits of Estonian e-Residency?
A secure national digital identity is the basis for providing online services to EU residents. Having an Estonian digital identity would potentially mean having an online identity valid in all EU countries that accept Estonian digital identity. Currently, it gives you full access to all of Estonia’s public online services like the e-business register, e-tax office etc. European Union countries are following the Estonian lead by implementing strong digital identities according to the 2014 EC directive (eIDAS).
What is the use of Estonian digital identity?
The most common reason for applying is founding a company in the EU online. One fun fact is that even people from the EU countries apply for Estonian e-Residency even though they could do it in their own country by visiting officials and submitting some paperwork. The reason is that Estonia has excellent public online services such as company formation and administration, which are really quick and simple compared to many other EU countries. A limited company in Estonia can be registered online within five minutes with Unicount. Estonia is a paperless society and all the aspects of company management can be performed online.
The most popular public and private e-services are:
online company formation and management
online banking
digital signing of legal documents
presenting annual reports and tax returns
Why have an Estonian company?
For anyone not living in the EU, it is one of the best opportunities to run a company online and remotely in the EU single market. Estonian companies have access to global payment service providers like Stripe, PayPal and mobile app stores Google Play and the App Store. An Estonian company is a trusted and accepted legal entity that can sign up for most services globally. Estonia also has a simple and fair tax system with zero per cent annual corporate income tax as long as you keep your profit earned in the company and reinvest it.
How to apply for Estonian e-Residency?
To start the application process, you need to fill out an online application and attach a photo, passport scan and explanation about why you wish to apply for e-Residency of Estonia. The Estonian government charges a state fee of 100 euros for processing your application. Visa and MasterCard are accepted for paying online. You can also read more from our blog post “How I became an Estonian e-resident“.
After your submission, there is a 4-6 week waiting time while your background check is performed and the card is printed. You can then pick up your e-resident digital ID card in Estonia, from the Estonian embassies around the world that work as pick-up locations. Please note that there are pick-up fees everywhere outside of Estonia. Delivery to Estonian embassies and consulates costs 20 euros.
E-Residency does not grant you any travel or residency rights
The Estonian e-Residency card can’t be used as a travel document. It also doesn’t grant you citizenship, tax residency, a residence permit, or the right of entry into Estonia or the rest of the European Union. The Estonian e-Residency programme gives you an opportunity to apply for a secure digital identity from the Estonian government for online use only. On the front of the ID card is printed “ainult elektrooniliseks kasutamiseks, which means “for electronic use only” in Estonian. If you are approved for a digital identity, your right to visit or live in Estonia or the EU are separate matters subject to different applications and policies. Estonia does have a startup visa programme, which gives you the opportunity to migrate to Estonia with your startup. Starting from 1 August 2020 there is also a digital nomad visa programme.
E-Residency does not make you an Estonian tax resident
Being approved for Estonian e-Residency does not mean that you become a tax resident of Estonia. To become a tax resident as a natural person you have to have a residence in Estonia or stay in Estonia for at least 183 days over the course of a period of 12 consecutive calendar months. There might be situations where you qualify as a tax resident in more than one jurisdiction and therefore can be a tax resident in more than one jurisdiction.
Is there a programme for becoming a resident entrepreneur?
Estonia has its own “golden visa” programme for entrepreneurs who have invested more than 65 000 euros in Estonia. The next threshold would be 1 million euros for major investors. A major investor is a non-resident who has made a direct investment of at least 1 million euros in a company registered in Estonia that invests mostly into the Estonian economy, or an investment in an investment fund, according to the investment policy of which the instruments of the fund are invested mainly into companies registered in Estonia. You can read more here.
Thanks for reading
We hope you enjoyed this article. If you have more questions check out Unicount’s extensive support articles here.
