Earlier this week, Unicount hosted a live webinar for e-residents. The session was called E-Residency Can Power Your Business, and it brought together our business expert to answer real questions from real founders.
During Q&A, we covered everything from dividend payments and tax obligations to accounting workflows and intellectual property rights. The questions were sharp, the concerns valid, and the insights worth sharing. So in this blog, we’re highlighting the most important takeaways, especially for e-residents planning their businesses or navigating cross-border taxation.
How do dividends work for Estonian companies owned by e-residents?
Estonia’s tax system is famously simple: there’s no annual corporate income tax on retained profits. But when you distribute dividends, corporate income tax applies. For the 2025 tax year, the rate is 20 percent on gross dividends, which results in an effective tax rate of 25 percent. For example, if you want to receive €800 net, your company must pay €200 in tax the following month.
Dividends should only be paid after the annual accounts are approved. This is especially important for companies with multiple shareholders. For sole-shareholder companies, the process is more straightforward, but the timing and documentation still matter.
It’s also important to remember that dividends are taxed in Estonia, but they may also be subject to personal income tax in your country of residence. This depends on local laws and tax treaties, so we always recommend consulting a tax advisor before making any distributions.
What documents do you need to prepare for your accountant?
To file annual accounts accurately, your accountant will need a clear record of your company’s financial activity. That includes:
- Purchase invoices and receipts
- Bank account statements
- Contracts (employment, rental, service agreements)
- Any other transaction-related documents
If your business operates across borders, additional documentation may be needed to comply with international tax treaties. Keeping your records organized throughout the year makes filing easier and ensures you stay compliant.
What if you’re a perpetual traveller with no clear tax residency?
This question came up during the webinar, and it’s a common concern. Even if you don’t spend 183 days in any one country, you may still be considered a tax resident somewhere, especially if you have property, social security, or other ties.
In Estonia, companies must withhold tax when making payments to private individuals. If you’re not a tax resident of Estonia, and you live elsewhere, employment taxes should be paid in that country. This applies whether you’re withdrawing a salary or receiving director’s fees.
The key takeaway: even if your Estonian company is compliant, you may still have obligations in your home country. Seek professional advice to avoid unintended tax risks.
Can you work as a contractor for your current employer through your Estonian company?
Yes, many e-residents use their Estonian company to invoice clients or employers abroad. This setup is common for consultants, developers, designers, and other freelancers. However, it’s important to structure the relationship correctly.
If your company is effectively replacing an employment contract, some countries may treat it as disguised employment. That could trigger tax liabilities or compliance issues. Again, local advice is essential.
Do you ever need to visit Estonia?
No. Once you’ve received your e-residency digital ID card, you can manage everything online from company formation to tax filings. Physical visits are optional, not required.
What about intellectual property created outside Estonia?
If you create software, designs, or other IP while living abroad, those assets can still be owned by your Estonian company. Estonia respects international IP rights and offers a stable legal framework for digital businesses. Just make sure your contracts and ownership structures are clear.
What if local tax rules make it hard to use an Estonian company?
This was one of the most honest questions we received. Some founders love Estonia’s simplicity but struggle with tax compliance in their home country. They worry about being seen as hiding income or evading taxes, even when they’re trying to do things properly.
The truth is, using an Estonian company is not a shortcut. It’s a legitimate business structure that works best when paired with local compliance. Paying yourself a salary and declaring it correctly is a good start, but it may not be enough. You need to understand how your home country views foreign income, director’s fees, and dividends.
If you’re unsure, speak to a tax advisor who understands cross-border structures. And if you need help preparing your Estonian accounts, Unicount’s accounting service is designed for e-residents just like you.
Final thoughts
The webinar reminded us that e-residents are smart, curious, and serious about building sustainable businesses. The questions were thoughtful, and the concerns real. If you missed the session, we’ll be hosting more in the future, and we’ll keep sharing insights here on the blog.
In the meantime, if you’re navigating dividends, accounting, or tax compliance, we’re here to help. Unicount offers simple company formation, streamlined accounting, and expert support tailored to the needs of e-residents.
