Introduction & Benefits How to set up Estonian LLC Requirements and considerations Estonian company registration Incorporation Ltd assistance Talk with us now
Limited Liability Company in Estonia
The main advantage of having a company registered in Estonia is a zero tax on undistributed profit. Continue reading to find out what exactly are the full benefits of setting up a Limited Liability Company in Estonia.
Request a consultationIntroduction & Benefits
Setting up a company is a significant step for anyone, and choosing Estonia is an excellent way to mark your presence in the European Union (EU). While expanding your company is exciting, it can also be stressful to build a new business in a place where you may not be familiar with local laws. Instead of figuring it out alone, Incorporation Ltd can help.
The main advantages of having a company in Estonia
- 0% company income tax (tax on retained earnings);
- Founders and Board members may be non-residents of Estonia (no local Director required);
- No mandatory requirement to pay a salary to the company's director;
- No salary requirements.
The tax on distributed profit is 20%. Please bear in mind that Estonia is not considered an offshore jurisdiction nor a tax haven so your Estonian company will be a reputable one.
Here is everything to know about setting up an Estonia company as an entry point in European Union.
How to set up an Estonia Limited Liability Company
The Estonian private limited liability company (LLC, also known as OÜ for Estonian osaühing) is the legal entity most preferred by entrepreneurs for Estonian company setup. A limited liability company in Estonia requires at least 1 shareholder, who can either be an individual or a corporate of any nationality. It's the most common business entity among both Estonian residents and e-residents.
Registration requirements and considerations
Several considerations must take place before registering a company in Estonia.
Estonian legal address
A legal address and a contact person are required to register the OÜ if the management board does not physically reside in Estonia. Both of these services can be purchased from a licensed virtual office service provider. Ask Incorporation Ltd more about contact person and legal address requirements.
More than one shareholder
If you are planning to register a multi-shareholder company, most likely each founder will need to apply for e-Residency if they do not currently have a digital ID or mobile ID valid in Estonia, digital ID valid in Latvia or mobile ID valid in Lithuania. Inquire us to understand why.
Management board
An OÜ must have a management board, a body to represent and manage the company. The management board may have one or several members with full or limited representation rights.
Share capital
Required minimum share capital of an OÜ is €2500. If the founders are private persons, they can defer the share capital payment, but until the share capital has been paid in full amount, the founders are personally liable for the obligations of the OÜ in the amount equal to their unpaid share capital.
Minimum nominal value of a share and the smallest shareholding is 1 euro cent, that is 0.01 euros.
Estonian company flexibility
In Estonia, one OÜ can do business in multiple fields of activity. You do not need to register two separate companies if you wish to be active in more than one field. When you register your company, you must indicate the planned principal activity (according to EMTAK code) that you expect to produce the most turnover in the first fiscal year. After the first fiscal year, you will need to submit an annual report demonstrating all areas of business activity based on turnover. Estonian government make sure your company's information is up-to-date and reflects the main commercial activity based on your annual tax report.
Steps to register the company
A brief overview on what you'll encounter while registering Estonian LLC.
- Deposit the minimum capital amount;
- Verify your company and reserve your name;
- Get a notary to draft and notarize your company deed;
- Apply for a business license;
- Register with the Trade and Companies Register;
- Register for VAT;
- Unblock the authorized capital.
There can be additional requirements based on various circumstances. Contact Incorporation Ltd today and get hassle-free consultation on the way forward with your company incorporation in Estonian jurisdiction.
Estonian company registration by Incorporation Ltd
Incorporation Ltd provides a holistic approach when it comes to doing business in Estonia. The offer among other nuances includes:
- Consulting on what is Estonian e-Residency;
- Required document write-up;
- Explanation of corporate bank account for the company;
- Introduction on how accountancy will be managed;
- Solving local phone issues;
- Annual commitment reminders (if long term corporation is agreed).
Once everything's agreed and setup has commenced, you'll have the company at your disposal at the instant Estonian government approves the application of registration.
Your business growth and Incorporation Ltd assistance
Once start operating your business, you can enjoy multiple benefits. A company can run independently from your parent company, protecting the parent company from any costly litigation or mistakes. An Estonian company has full rights and protections in any European Union country. Let us know when you're ready for a journey on registering Estonian company.